Unveils growth plan to the investor community at Annual Investor Day 2024
Nykaa has unveiled its growth trajectory and future plans at the Annual Investor Day 2024. At the event, Nykaa’s senior management took the analyst and investor community on a journey of Nykaa’s present and plans for the future.
Falguni Nayar, Executive Chairperson, Founder and CEO, Nykaa said, “Nykaa’s success so far has been rooted in driving quality growth by foreseeing the potential in the lifestyle ecosystem and making future-forward investments. Our conviction and efforts in beauty over the last decade is now reflected in a market bound to become a 90 billion USD market over the next 15 years, with Nykaa continuing its industry-leading growth. The results of our more recent investments in Fashion and eB2B are reflected in the past year through the much-improved profitability in both businesses. Both are expected to continue to expand margins rapidly in the next two to three years, leading to a positive improvement in Nykaa’s consolidated margins.”
According to research, the Indian beauty market which currently stands at USD 19 billion, is expected to accelerate by five times. The BPC e-commerce market is expected to grow from 3 billion USD to 40 billion USD in 2037. As the share of upper- and middle-income households grows in India, the premium BPC market is expected to grow by 25 per cent CAGR in the next 15 years.
Nykaa’s plans for robust customer acquisition, increasing category width and depth, premiumisation of purchasing behaviour and delivering on-ground experiences as part of its online strategy. With 187 stores spread across 68 cities today, Nykaa is gearing towards doubling the store count by 2027. The Nykaa Global Store has grown five times over the last 4 years, witnessing a 50 per cent CAGR, now comprising of 39 global brands.
FY24 witnessed IPs such as Nykaaland, Nykaa Wali Shaadi and Nykaa CSMS.
Superstore is transforming the traditional distribution model, democratising access for underserved retailers, now serving approximately two lakh retailers across 1,000 cities. The business has seen orders grow by 71 per cent in FY24 and witnessed a contribution margin improvement of over 900 bps and an EBITDA margin expansion of around 2200 bps.
Nykaa has surpassed 1 billion USD GMV, with a 39 per cent CAGR over the past five years. The brand has serviced over 150 million cumulative orders till date with over a billion online visits annually.
Nykaa Fashion aims to grow to 2.5-3 times over the next 3 years and aspires to become EBITDA positive in the near future. The brand has a 20 per cent market share in the women’s online premium market.
Nykaa’s consumer brands business witnessed 47 per cent CAGR in the beauty consumer brands GMV and 112 per cent CAGR in the fashion consumer brands GMV over FY21-24. The portfolio in beauty and fashion offers 14 and 13 brands respectively across categories such as makeup, skincare, personal care, fragrances, ayurveda in Beauty and lingerie, western wear, ethnic wear and accessories in fashion.
Nykaa’s ambition extends beyond Indian borders with the recent launch of Nysaa in the GCC (Gulf Cooperation Council) market, reflecting its vision for a global growth strategy. GCC represents a 30 billion USD BPC market opportunity with a per capita consumption of over 500 USD. Nysaa launched in March 2024 across ecommerce and physical retail, opening its first store in Dubai. Nysaa plans to open five new stores this year and become 70 stores strong in five years.
Nykaa has also co-created programs that provide holistic education, upskilling and livelihood opportunities. With academic institutions like IIM-A, Nykaa is making concerted efforts to develop consumer technology research solutions. Other CSR programs focus on supporting education, including STEM with American Indian Foundation (AIF), vocational training to empower underprivileged women with Labournet and providing healthcare in underserved communities.
Nykaa also leverages data and ML/AI technologies to create personalised customer experiences and optimise ad selection. At the event, Nykaa conducted a GenAI-powered demo, highlighting semantic search and AI-assisted training for retail stores.
