Nykaa IPO opens for subscription today | Price band, lot size, grey market premium, other details

Nykaa IPO: The initial public offering (IPO) of Nykaa has opened for public subscription on Thursday and will conclude on November 1. Ahead of its IPO, FSN E-Commerce Ventures Ltd, which operates online beauty e-commerce platform on Wednesday said it has raised ₹2,396 crore from anchor investors. 

It comprises equity shares aggregating up to Rs 630 crore (fresh issue) and an offer for sale of up to 41,972,660 equity shares being offered by the selling shareholders (offer for sale or OFS)

Nykaa IPO: Price Band

The Rs 5,352-crore public issue, Nykaa has fixed a price band of Rs 1,085-1,125 per share for its initial public offer (IPO) that opens for a subscription later this week. This will be the biggest IPO since that of online delivery firm Zomato’s Rs 9,375-crore offering in July.

Nykaa IPO: Lot Size

Bids can be made for a minimum of 12 equity shares and in multiples of 12 equity shares thereafter. The offer includes a reservation of up to 250,000 equity shares for purchase by eligible employees.

Nykaa IPO: GPM

As per market observers, Nykaa shares are available at a strong premium (GMP) of ₹625 in the grey market today, reports Livemint. The company's shares are expected to list on leading stock exchanges NSE and BSE on November 11. The grey market premium of Nykaa IPO surged 53.33 per cent over the higher end of the issue price of Rs 1,125.

According to the report, on October 27, the shares of Nykaa were trading at Rs 1,725 apiece in the unlisted market. A soaring GMP often indicates a healthy listing of shares on the bourses.

Nykaa IPO: Allotment

The Allotment of shares is going to finalize on the 8th November 2021. The issue is likely to be listed in November 2021 on stock exchanges BSE and NSE.

Nykaa Brand IPO: Overview 

The company is reportedly seeking a valuation of over USD 7 billion. Existing investors like such as TPG Growth IV SF Pte, Lighthouse India Fund and others are expected to offload their shares in the IPO. Promoters, including founder and CEO Falguni Nayar, currently own more than 50 per cent share in the company.

Nykaa had posted a net profit of Rs 61.9 crore in FY21 compared to a loss of Rs 16.3 crore in FY20. Its total income stood at Rs 2,452.6 crore in FY21 as against Rs 1,777.8 crore in FY20.

Founded in 2012, Nykaa is a digitally native consumer technology platform, delivering a content-led, lifestyle retail experience to consumers. It has a diverse portfolio of beauty, personal care and fashion products, including its own-brand products manufactured by third-party manufacturers.

In FY2021, 17.1 million orders were placed on Nykaa’s platform for beauty and personal care products with a total GMV of Rs 33,804.1 million, a 35.3 per cent increase over FY2020.

Apart from its online presence, the company also has 38 Luxe stores, 32 On-trend stores and 9 kiosks. Nykaa is also keen on international expansion. 

Asked about contribution from offline retail, Nykaa CEO (Beauty E-commerce) Anchit Nayar said pre-pandemic, about 8-10 per cent of the company’s business came from physical retail.

The company proposes to use the proceeds from the IPO towards acquiring and retaining customers by enhancing the visibility and awareness of its brands, repayment of outstanding borrowings availed by the company and one of its subsidiaries, setting up new retail stores and setting up new warehouses.

The GMV contribution of own brands of Nykaa was about 8 per cent in FY21 and 7.5 per cent in the first quarter of this fiscal.

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