Nykaa slides as anchor lock-in period ends

FSN E-Commerce Ventures (Nykaa) fell 1.89% to Rs 2111.85 as the mandatory one-month lock-in of anchor investors expired for the stock today.

Anchor investors are marquee institutional investors who are allotted shares in a company ahead of its IPO.

Nykaa raised Rs 2,395.84 crore in its anchor book allocation from 174 investors ahead of its IPO. The firm allocated 2,12,96,397 shares at the upper price band of Rs 1,125 per equity share.

Offloading by anchor investors deflates stock price due to increase in floating stock.

The Nykaa stock entered the bourses on 10 November 2021. It was listed at Rs 2001, a premium of 77.87% to the issue price of Rs 1125.

The IPO of Nykaa was subscribed 81.78 times. The issue opened for bidding on 28 October 2021 and it closed on 1 November 2021. The price band of the IPO was fixed at Rs 1,085-1,125 per share.

Shares of FSN E-Commerce have fallen 15.27% in five consecutive sessions from their recent closing high of Rs 2,492.50 hit on 1 December 2021.

The stock is down 17.95% from its record high of Rs 2,574 hit on 26 November 2021.

Nykaa is one of India's leading lifestyle focused consumer technologies platforms. It offers 4,078 brands and over 3.1 million product SKUs through its website and mobile applications as of 31 August 2021.

The company's consolidated net profit slumped 95.56% to Rs 1.2 crore on 46.62% increase in net sales to Rs 885.30 crore in Q2 FY22 over Q2 FY21. Profit before tax fell 95.71% to Rs 1.40 crore in Q2 September 2021 over Q2 September 2020. Revenue from operations grew 8% on sequential basis.

Marketing support revenue grew by 68% YoY. Gross profit margin was at 42.7%, improving by 213 bps sequentially primarily led by increase in share of GMV from owned brands and increase in share of Fashion GMV. EBITDA fell 48% year-on-year to Rs 28.8 crore. EBITDA margin stood at 3.3% in Q2 FY22, lower than 9.1% in Q2 FY21.

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