Last Updated:
Nykaa shares are likely to be on investors’ radar on Tuesday after it reported a 61% YoY increase in consolidated net profit in Q3
Nykaa
Nykaa shares are likely to be on investors’ radar on Tuesday after the company reported a 61% year-on-year (YoY) increase in consolidated net profit, reaching Rs 26.12 crore, although this fell short of the expected Rs 36 crore.
Revenue, however, met expectations, rising 27% YoY to Rs 2,267 crore. The company posted an EBITDA of Rs 141 crore for the October-December 2024 quarter, with a margin of 6.2%, both in line with estimates.
On a sequential basis, profit after tax (PAT) more than doubled from Rs 10 crore in the previous quarter (September), while revenues increased by 21% quarter-on-quarter (QoQ). Other income for the quarter decreased to Rs 5.53 crore, down from Rs 7.58 crore in the same quarter last year.
The company highlighted its expanding beauty retail network, now with 221 physical stores across 73 cities, having opened over 47 stores in the last year. With a GMV productivity of Rs 4,250 per square foot per month, Nykaa claims to have one of the most profitable store networks in the sector.
Nykaa Target Price
According to Trendlyne data, the average target price for Nykaa shares is Rs 193, suggesting a potential upside of 14% from current market levels. The consensus recommendation from 24 analysts is a ‘Buy’ rating.
Kushal Gandhi, a Technical Analyst at StoxBox, noted that the price action of Nykaa initially suggested a promising shift towards a more dynamic phase, indicating a potential uptrend.
However, the stock has since declined by over 30% from its 52-week highs and is currently trading just below both the 50-week moving average and the 200-day moving average. As a result, Nykaa has shown a decline in its EPS, price strength, and buyer demand. From a technical standpoint, the stock lacks positive momentum, as indicated by the RSI across daily and higher timeframes staying below median levels, with no divergence from the price action.
Given that the stock is trading below key moving averages and has recently experienced a negative crossover, it is advised not to purchase additional shares of Nykaa until it decisively reclaims the 200 DMA, which is currently around the 180 levels.
