Nykaa IPO to open on October 28; nine things you must know

The initial public offering (IPO) FSN E-Commerce Ventures, the parent company of India’s biggest cosmetics and personal care products etailer Nykaa is slated to open on October 28. Check, price band, lot size, open & close date, issue size, financial and other details for the issue.

Open and close date: The offer will open for subscription on October 28 and the bidding will close on November 01. The anchor book, if any, will open for a day before the issue opening, i.e. October 27.

Price band: The price band for cosmetic etailer has been fixed at Rs 1,085-1,125 per share having a face value of Rs 1 per share.

Lot size: Investors can bid for a minimum of 12 equity shares and in multiples, thereafter, translating to a minimum bidding amount of Rs 13,500 at the higher end of the price band. A retail investor can at max apply for 14 lots or 168 shares for Rs 1,89,000.

Issue size: The Rs 5,351.92-crore public offer comprises fresh issuance of equity shares of Rs 630 crore, and an OFS (offer for sale) of Rs 4721.92 crore by existing selling shareholders TPG, Light House India Fund, JM Financial, Yogesh Agencies, Sunil Kant Munjal, Harindarpal Singh Banga, Narotam Sekhsaria and Mala Gaonkar. Promoter Sanjay Nayar Family Trust will sell 4.8 million shares.

Objective of issue: The company will utilise the net proceeds from the fresh issue towards setting up of new retail stores, warehouses, repayment or prepayment, of outstanding borrowings, creating brand awareness and for general corporate purposes.

What’s in it for retail investors: Not more than 75% of the total offer has been reserved for qualified institutional buyers, up to 10% for retail investors, and the rest 15% for non-institutional buyers.

About the company: Nykaa was founded in 2012 by investment banker Falguni Nayar and is a leading player in the online beauty aggregator segment.  The company has a diverse portfolio of beauty, personal care, and fashion products, including their own brand products manufactured by them. The company operates under 2 major verticals Nykaa (beauty & personal care) and Nykaa Fashion (apparel & accessories).

On the financial front, the company reported a profit after tax of Rs 61.94 crore for the quarter ended FY21 compared to a loss of Rs 24.5 crore in FY19. Whereas it’s total revenues more than doubled to Rs 2,452.63 versus Rs 1,116.38 crore. For the quarter ended June 21 the company posted a profit after tax of Rs 3.52 crore on total revenues of Rs 821.71 crore.

Book running lead managers and registrar to the IPO: The book running lead managers to the issue are Kotak Mahindra Capital Company, Morgan Stanley India Company Private Ltd, BofA Securities India, Citigroup Global Markets India Private Ltd, ICICI Securities, and JM Financial. The registrar to the issue is Link Intime.

Issue timeline: The issue is likely to finalize the basis of allotment by November 08, and the initialization of refunds will take place by November 09. While the credit of equity shares to depository accounts of the allottee will be done on November 10. The cosmetics etailer is expected to make its stock market debut on November 11, 2021.