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Nykaa Q4 FY24 Earnings Call Summary
Financial Performance • Q4 Highlights: • GMV growth: 32% YoY to Rs 3,217 crores • Revenue from operations: 28% increase to Rs 1,668 crores • Gross profit: Rs 710 crores • EBITDA: Rs 93.3 crores (32% growth) • Adjusted EBITDA: 56% increase
• Full Fiscal Year: • GMV: 28% growth to Rs 12,446 crores • Revenue from operations: 24% increase to Rs 6,386 crores • Strong growth in beauty and personal care (BPC) and fashion segments
Segment Performance • Beauty and Personal Care (BPC): • Q4 GMV: Rs 2,120 crores (30% YoY growth) • Full-year GMV: Rs 8,341 crores • 79% of sales from existing customers • Significant traffic increase: 1.1 billion visits
• Fashion Segment: • Q4 GMV: Rs 842 crores (27% YoY growth) • Focus on women's fashion categories • Improved conversion rates and contribution margins
• Superstore Segment: • GMV growth: 84% to nearly Rs 600 crores • 120% increase in Net Sales Value (NSV)
Strategic Initiatives • Diversification and Expansion: • Entry into GCC market with Nysaa brand • Physical retail expansion: 187 stores across 68 cities • Plans to open 350-400 additional stores
• Marketing and Customer Acquisition: • "Stepification of Beauty" campaign to enhance beauty consumption • Focus on improving awareness, availability, and affordability • Exclusive partnerships with global beauty brands
Financial Health and Future Outlook • Profitability and Margins: • 25% growth and 80 basis points improvement in adjusted margins • Ongoing investments in retail expansion and technology • Optimism about sustaining growth and improving profitability
• Challenges and Market Conditions: • Addressing concerns about EBITDA shortfalls and margin expectations • Acknowledgment of challenges in the fashion segment • Confidence in long-term recovery of demand
Conclusion • Nykaa's executives expressed optimism about future growth, particularly in physical retail and customer acquisition, while emphasizing the importance of leveraging technology for enhanced customer experiences.
FSN E-Commerce Ventures Limited (Nykaa) Q3 FY24 Earnings Call Summary
Financial Performance Highlights • Gross Merchandise Value (GMV): ₹36,194 million (29% YoY growth) • Net Sales Value (NSV): ₹17,866 million (24% YoY growth) • Revenue from Operations: ₹17,888 million (22% YoY growth) • Gross Profit: ₹7,607 million (20% YoY growth; Gross Margin: 42.5%) • EBITDA: ₹988 million (26% YoY growth) • Profit Before Tax (PBT): ₹265 million (109% YoY growth) • Profit After Tax (PAT): ₹175 million (106% YoY growth)
Business Segment Performance • Fashion Segment: • GMV increased by 40% YoY • Unique transacting customers: 2.9 million • Partnership with Footlocker as exclusive e-commerce partner in India • Beauty Segment: • GMV growth of 25% over two years • Repeat customer rate improved to 78% • Nykaaland beauty festival attracted over 15,000 attendees • Others Category: • 39% YoY growth, including Superstore business
eB2B Segment Growth • Achieved over 31x growth in GMV and 40x in NSV over two years • Increased transacting retailers to 337,000 • Improved average order value (AOV) by 13% YoY
Strategic Initiatives • Focus on premiumization in beauty consumption • Expansion of physical retail to 174 stores • Investment in marketing and customer acquisition to enhance growth
Challenges and Market Dynamics • Increased discounting in the beauty sector affecting margins • Post-COVID normalization impacting online BPC growth • Need for consumer education to drive demand in the premium beauty segment
Future Outlook • Emphasis on growth over immediate margin improvement • Potential for significant growth in the prestige/premium beauty segment • Ongoing expansion of product assortments in both beauty and fashion
Conclusion • Nykaa is well-positioned to leverage its market position and brand equity to drive growth across segments, with a strong focus on customer engagement and education in the beauty market.
Conference Call Overview • Date: November 6, 2023 • Participants: Key executives including Falguni Nayar (CEO), Anchit Nayar (CEO, Beauty e-commerce), Adwaita Nayar (Co-founder CEO, Nykaa Fashion), P Ganesh (CFO). • Purpose: Discuss unaudited financial results for Q2 FY24. • Transcript available on the company's website.
Financial Performance Highlights • Q2 FY24 Results: • Net Sales Value (NSV) increased by 24% to Rs. 1,498 crores. • Revenue from operations rose by 22% to Rs. 1,507 crores. • Gross profit grew 16% to Rs. 650 crores (margin: 43.1%). • EBITDA increased by 32% to Rs. 80.6 crores. • Profit before tax and profit after tax both up by ~50%.
Business Segment Performance • Beauty and Personal Care: • NSV growth of 19%. • 79% of beauty GMV from existing customers. • Fashion: • NSV growth of 32%. • Fashion contributes 15.5% to NSV. • Others Category: • Remarkable 105% growth in NSV.
Customer Engagement and Retention • Strong customer retention with 79% revenue from existing customers. • Significant growth in unique transacting customers and orders on NykaaFashion.com. • eB2B platform NSV increased by 130%.
Trends in Beauty Market • Shift from unorganized to organized retail. • Increased per capita spending on beauty products. • Nykaa's focus on consumer education and partnerships with over 3,600 brands.
Events and Initiatives • Successful "Nykaaland" festival with over 15,000 attendees. • Hot Pink Sale achieved 37% growth in omnichannel beauty GMV. • Launch of K-beauty store and related events.
Skincare Strategy • Development of "I-beauty" regimen tailored for Indian skin. • Comprehensive awareness campaign generated over 123 million impressions. • 60% of customers now purchase skincare products, with significant growth in serum and sunscreen sales.
Fashion Business Strategy • Focus on premium, fashion-forward platform. • New initiatives like Gen Z store and Nykaa Fashion Luxe store. • Record metrics during recent mega sale (18 million visits, 1.3% conversion rate).
Own Brands Development • 13 beauty brands and 16 fashion brands developed. • Kay Beauty and Nykd brands showing significant growth.
Social Impact and Sustainability • Collaboration with over 6,700 brand partners and 7,000 suppliers. • Initiatives for job creation and sustainability (e.g., "Conscious at Nykaa"). • Commitment to diversity and empowerment through education.
Financial Insights • 22% revenue growth despite festive season shift to Q3. • Stable gross margins at 43.1%. • Focus on reducing marketing costs and improving profitability.
Competitive Landscape • Competitive intensity remains stable; brand proliferation beneficial for advertising income. • Increased discounting by brands attributed to market conditions rather than Nykaa's strategy.
Future Outlook • Management expresses confidence in ongoing margin improvements and operational efficiencies. • Focus on both new customer acquisition and repeat customer growth.
FSN E-Commerce Ventures Limited Q1 FY24 Earnings Call Summary
Key Financial Highlights • Date of Call: August 11, 2023 • Gross Merchandise Value (GMV): • 24% YoY growth to ₹26.7 billion • Revenue: • 24% YoY increase to ₹14.2 billion • Gross Profit: • 21% rise to ₹6.2 billion • EBITDA: • 60% increase to ₹735 million • Profit Before Tax: ₹97 million • Profit After Tax: ₹54 million
Segment Performance • Beauty Segment: • 24% GMV growth • 79% from existing customers • Strong offline retail growth (27%) • Fashion Segment: • 12% GMV growth, attributed to industry challenges • 44% of GMV from repeat customers • Incubation Business: • Contributed 6.1% to GMV
Market Insights • Beauty and Personal Care (BPC): • Projected 10% overall growth, 29% online growth by 2027 • Nykaa's owned brands grew 39% in GMV • Fashion Market: • Expected CAGR of 27%, reaching $50 billion by 2027
Customer Engagement and Technology • Personalized Experiences: • Introduction of "My Nykaa" tailored feeds • Expansion to ship internationally to 12 countries • eB2B Business: • Significant growth in transacting retailers and GMV
Operational Efficiency • Revenue Growth: • 24% YoY increase with improved EBITDA margins (5.2%) • Cost Management: • Focus on regionalization and cost rationalization
Brand Development • Dot & Key: • Modern D2C skincare brand with ₹3 billion run rate, aiming for ₹5 billion by 2026 • Kay Beauty: • Fast-growing brand on Nykaa
Challenges and Future Outlook • Fashion Segment: • Faced challenges but showed signs of recovery in July • Advertising Revenue: • Slight decline due to transition to self-serve ad platform • Margin Concerns: • Discussions on gross margins and profitability across segments
Conclusion • Long-term Growth Potential: • Confidence in achieving profitable scale despite macro challenges • Commitment to Shareholders: • Focus on creating long-term value through strategic initiatives and brand performance.
Conference Call Announcement • Date: May 31, 2023 • Transcript available on the company's website • Discussed financial results for Q4 and FY2023
Financial Performance Highlights • Q4 FY2023: • GMV: Rs 2,445 crores (36% YoY growth) • Revenue: Rs 1,302 crores (34% YoY growth) • Gross Profit: Rs 576 crores (35% YoY growth) • EBITDA: Rs 71 crores (84% YoY growth) • PAT: Rs 2.3 crores (lower than expected) • Full Year FY2023: • GMV: Rs 9,743 crores (41% YoY growth) • Revenue: Rs 5,144 crores (36% YoY growth) • Beauty GMV growth: 33%, Fashion GMV growth: 47%
Operational Developments • Significant increase in employee headcount, especially in retail and technology • 43% increase in physical store area, totaling 1.4 lakh square feet • Warehouse capacity increased by 80% this year
Market Growth Potential • Indian Beauty and Personal Care (BPC) market projected to grow from $19 billion in 2022 to $31 billion by 2027 • Nykaa's strategies include enhancing customer acquisition, brand partnerships, and retail presence
Retail and Owned Brands Performance • Retail space expanded to 1.4 lakh square feet (43% YoY increase) • Owned brands generated Rs 789 crores in GMV (12% of overall BPC business) • Fulfillment centers increased from 25 to 38
Fashion Market Insights • Fashion market projected to grow from $77 billion in 2022 to $147 billion by 2027 • Nykaa Fashion's strategy focuses on customer acquisition, brand assortment, and technology integration
SuperStore Segment Growth • Significant increase in transacting retailers and brands listed • Focus on technology investments to enhance retailer experience
Financial Updates • Q4 FY23 revenue growth: 34% YoY • EBITDA margins improved to 5.4% • Stable inventory and receivable days, cash position of Rs 41 crores
Future Outlook • Plans to open no more than 50 new beauty stores • Joint venture in the Middle East expected to launch in H2 2023 • Focus on sustainable growth and improving contribution margins
Challenges and Management Strategies • Addressed concerns about negative free cash flow and cash management • Emphasis on controlled expansion and cost management in fashion and eB2B verticals
Closing Remarks • Falguni Nayar expressed gratitude for participant engagement and invited further questions.
Conference Call Overview • Date: February 17, 2023 • Purpose: Discuss unaudited financial results for Q3 and nine months ending December 31, 2022 • Key Executives: Falguni Nayar (Executive Chairperson), P. Ganesh (CFO), Anchit Nayar, Adwaita Nayar
Financial Performance • Quarterly Results: • GMV: Rs. 27.9 billion (37% YoY growth) • Revenues: Rs. 14.6 billion (33% YoY growth) • Nine-Month Results: • GMV: Rs. 72.9 billion (42% YoY growth) • Segment Growth: • Beauty: 26% GMV growth • Fashion: 50% GMV growth
Market Insights • Beauty and Personal Care Market: • Valued at $19 billion in 2022, projected to reach $31 billion by 2027 (CAGR of 10%) • Online BPC expected to grow at 29%, reaching $10 billion by 2027 • Fashion Market: • Projected to reach $147 billion by 2027 (CAGR of 27%)
Growth Strategies • Focus on customer acquisition and retention • Strong brand partnerships and market penetration • Expansion of owned brands and consumer engagement initiatives • Successful Pink Friday sale and physical store expansion
eB2B Business Growth • Significant increase in transacting retailers (from 4,153 to 92,415) • Brands listed on the platform increased from 31 to 185 • Servicing 652 cities, with a 25x increase in processed orders
Financial Updates • Q3 FY '23: 33% YoY revenue growth, gross margin of 43.4%, EBITDA margin of 5.3% • Operating expenses decreased from 40% to 38% of revenue
Q&A Highlights • Growth Slowdown: Attributed to fewer festive sales days and discretionary spending impacts • Gross Margins: Decline due to increased discounts; stable margins in beauty and fashion • Sales Mix: Online sales dominate, with offline accounting for less than 10%
Capital Allocation and Future Investments • Focus on smart investments in beauty and fashion • Aim for profitability in owned brands, with significant revenue run rates needed • Emphasis on maintaining unit economics and efficient marketing strategies
Conclusion • Ongoing investments in customer acquisition, fulfillment, and technology • Optimism about sustaining growth in both beauty and fashion segments • Commitment to strategic investments for enhanced market presence and profitability