Why Nykaa Share Price is Falling

Indian stock markets are showing a positive trend today, 3 July. The BSE Sensex is up 310 points at 83,719 points. The NSE Nifty 50 is trading at 25,516 points, up 110 points.

The broader market indices such as BSE Midcap and BSE Smallcap are also up, indicating broad-based buying interest.

Major gainers include Asian Paints, Tata Steel, Shriram Finance, ICICI Bank, and Hindalco.

However, one stock that is falling today is FSN E-Commerce Ventures (Nykaa).

Let's tell you a reason for the same.

#1 Early Investor Sells Stake

Nykaa's early investors, the Banga family, are selling a 2.1% stake, about Rs 12 billion (bn), through a block deal. This involves the sale of up to 60 million (m) shares at a floor price of Rs 200 per share.

The floor price was at a 5.5% discount to the traded price of Rs 211.59 on 2nd July. This led to the stock correcting to align to the floor price.

Harindarpal Singh Banga, founder of The Caravel Group and a key early investor, currently holds nearly 5% of Nykaa. He has been gradually reducing his stake since before the IPO. The shares in this transaction are expected to be purchased mainly by foreign institutional investors.

This is a secondary sale, meaning no fresh equity is being issued and the proceeds will go entirely to the selling shareholders.

What Next?

Nykaa saw a good performance in Q4 FY25 in terms of revenues and net profits. The revenues of the company rose 24% YoY to Rs 20,618 m from Rs 16,680 m in the corresponding period of last year. The net profit surged 97% YoY to Rs 191 m in Q4 FY25.

Moving forward, the company has 237 stores, making it the largest beauty retail network in India. The company plans to expand this substantially this year.

Nykaa has ambitious plans for the beauty segment which is a key revenue driver. The company expects to sustain 23-25% annual revenue growth in beauty through deeper market penetration, premiumisation, and expanding category offerings.

Nykaa Now, the rapid delivery service offering 60-minute delivery in major metros, has achieved over 1 m orders, enhancing customer convenience and supporting profitability.

Following this success, Nykaa plans to expand Nykaa Now to more cities beyond the initial metro rollout to capture broader demand.

The company will continue to leverage AI-led personalisation and brand-funded programs to deepen customer engagement and drive sales.

Having said that the company faces stiff competition from reputed brands, which could pressure market share and margins.

How Shares of Nykaa have Performed Recently

Over the last one month, the share price of Nykaa has gained 4% from levels of Rs 195 to the current levels of Rs 203. In the past one year, shares of the company have gained 16%.

The stock hit a 52-week high of Rs 229.9 on 23 August 2024. The stock also hit a 52-week low of Rs 154.9 on 4 March 2025.

About Nykaa

Nykaa, officially known as FSN E-Commerce Ventures, is a prominent Indian retail company. It was founded in 2012 by entrepreneur Falguni Nayar with the vision of making beauty a mainstream choice.

Nykaa operates as a digitally native consumer technology platform that offers a content-led lifestyle retail experience.

Nykaa has invested in subsidiaries like FSN Brands and Nykaa Fashion to expand retail store presence and product offerings.

The company has expanded beyond beauty to include fashion and lifestyle products, with platforms such as Nykaa Fashion, Nykaa Man, and Superstore.

To know more, check out Nykaa fact sheet and latest quarterly results. You can also compare Nykaa with its peers on our website.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...