Nykaa Pre IPO Note - A Unique Business Model On The Cusp Of A Large Opportunity: Motilal Oswal
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Motilal Oswal Report
We analysed Nykaa’s draft red herring prospectus to understand the opportunity in the beauty and personal care and fashion segments, the company’s business model, and the competitive landscape.
We have also conducted an online survey among the target demographics and presented our findings.
The Indian BPC/ fashion market is expected to reach Rs 2 trillion/Rs 8.7 trillion by CY25. The online BPC and fashion markets are growing at an even faster pace. Growth would largely be driven by -
a higher propensity to shop online owing to increased internet/smartphone penetration as well as more convenient payment infrastructure (UPI),
large millennial and Gen-Z populations with aspirations and growing disposable incomes,
the rising influence of social media, especially among the key demographic
increased female participation in the workforce, and
the migration from unorganised to organised players.
Nykaa is estimated to control 35% of the online BPC market.
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