Beauty e-tailer Nykaa’s parent, Fsn E-Commerce Ventures Ltd was part of the new age tech startups listing in the market boom of 2021 along with Paytm and Zomato and has wiped off Rs 80,000 crore in less than 14 months since its listing.
The beauty e-commerce giant has slumped by 52% in a year after losing over 140 points. The 52-Week High is at Rs 319.62 and is currently trading at Rs 129.25.
Nykaa has slumped 13.66% in a month as it touched its 52-Week low of Rs 120.7. The stock fell by 3.8% before the closing bell of Wednesday.
Nykaa has a high PE ratio of 815.09 and an ROE of only 4.57%. The company has shown a negative Net Profit margin in 2019 (-2.28%), 2020 (-1.3%), and finally showed a positive Net Profit in 2021 (2.53%). The Net Profit for 2022 is at 1.09% as shown in the Trade Brains portal.
The stock has plunged 72% from its all-time high of Rs 429. Post its bumper debut in 2021, the stock has been hitting new lows adding to the losses of investors who haven’t exited at the debut.
The winds are singing a different tune for Nykaa as analysts find the stock attractive at its slashed price. ICICI Securities analyst Manoj Menon has upgraded the stock to ‘add’ from ‘hold’ with a revised DCF- based target price of Rs 145 from Rs 175 as reported by Money Control.
Data for the December quarter shows an increase in FIIs holding from 6.5% to 11% while mutual funds have doubled investment to own a 4% stake in the Nykaa parent as reported by Economic Times.
The new-age stocks have seen a steep fall in valuation post-listing with Paytm down 65% and Zomato down 61%. The listing at inflated valuations has created huge losses for investors.
The fundamentals of a stock factor into its valuation determining the direction of a stock eventually.
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