The scrip is trading at Rs 650-675 apiece in the unofficial market, about 60 per cent of its issue price of Rs 1,085-1,1125 per share.
The initial public offering of FSN will start on October 28 and close on till November 1. The company is likely to fetch a valuation of $7.1 billion in the initial offering. The operator of the beauty-products omnichannel is likely to raise Rs 5,352 crore, of which Rs 630 crore would be raised through sale of fresh equity shares. Promoters and shareholders would offload 43.11 million shares worth Rs 4,723 crore. Grey markets analysts and dealers of unlisted space are bullish on the counter due to multiple reasons, including strong fundamentals and growth prospects.
Abhay Doshi, co-founder, UnlistedArena, said the company was an exemplary example of a profitable startup with a reputed promoter. “The cosmetics and beauty products e-commerce company is yet to make its mark, the way smartphones have done it. Thus the company has super strong growth prospects,” he said.
Nykaa was founded in 2012 by Falguni Nayar, a former investment banker with Kotak Mahindra. It is a digitally native consumer technology platform, delivering a content-led, lifestyle retail experience to consumers. Nykaa is a multi-brand beauty and personal care platform that is expanding into the fashion and lifestyle segment. It is also trying to woo men with the launch of Nykaa Man.
The company will use the net proceeds from the fresh issue to establish new retail stores. The remaining portion will be considered for repayment of debt and enhancing the brand visibility.
Ankur Saraswat, Research Analyst, Trustline Securities, said the company was focussing on offline presence as well and that was why the retail stores were vital for its growth. He was also bullish on the profit-making e-commerce player’s growth. “The company is putting thrust on making its own brand as a market leader in the industry, and they are roping top-celebrities to endorse it,” he added
Kotak Mahindra Capital, Morgan Stanley India, BofA Securities India, Citigroup Global Markets India, JM Financial and ICICI Securities are the merchant bankers to the issue.
