Nykaa block deal: Banga family sells 2.1% stake for ₹1,213 crore; shares down 4%

Harindarpal Singh Banga and his wife Indra Banga on Thursday divested a 2.1% stake in FSN E-Commerce Ventures through bulk deals worth ₹1,213 crore.

Following the stake sale, shares of Nykaa declined by 4% to ₹203.50 apiece on the BSE and by 3.82% to ₹203.50 apiece on the NSE.

Harindarpal Singh is a commodities billionaire and Chairman and CEO of Hong Kong-based Caravel Group. Banga was an early investor in Nykaa, which went public in 2021.

As per the deal, up to 6 crore equity shares of FSN were sold at a final price of ₹202.25 apiece. This represents a discount of about 4.4% to FSN's closing price of ₹211.59 on the NSE on Wednesday, as per the term sheet accessed by PTI.

Goldman Sachs (India) Securities and J.P. Morgan India were the brokers for the deal.

The transaction comprises a sale of approximately 6 crore shares amounting to around a 2.1% stake in FSN.

After the latest transaction, Harindarpal's holding in Nykaa has come down to 2.87% from 4.97%.

Nykaa targets break-even for fashion arm in FY26

Recently, FSN E-Commerce Ventures said it has set a break-even target of FY26 for its cash-burning fashion arm on account of marketing efficiencies, overhead leverage, and own-brand growth.

Nykaa is also foraying into the quick-commerce arena with "Nykaa Now", which offers delivery times ranging from 30 to 120 minutes across seven major cities. The service is backed by a network of beauty warehouses, physical retail stores and rapid stores across the country.

The fashion vertical, which generated about ₹3,800 crore in GMV (Gross Merchandise Value), is currently a drag on consolidated profitability, posting a negative EBITDA margin of (8.3%) for FY25.

The Mumbai-headquartered firm anticipates achieving EBITDA break-even by FY26 and reaching a "steady state" margin of approximately 10 per cent by FY28.

This turnaround will be driven through a mix of strong repeat buying, its own brands' growth, and significant leverage in overheads with scale, Nykaa said in its annual investor day presentation last week.

Nykaa's profit more than doubled to ₹66.08 crore in FY25 from ₹32.26 crore logged in the previous fiscal year.

Its revenue from operations in FY25 stood at ₹7,949.82 crore, 24.4% higher than ₹6,385.62 crore in FY24.

During the fiscal year, Nykaa saw its cumulative customer base grow 28% year-on-year to over 42 million.

It added 50 retail stores during the year, bringing the tally to 237 stores, while its gross merchandise value (GMV) stood at ₹15,604 crore.