India: Fashion & beauty retailer Nykaa to raise $15m, expand private label

Credit: Flickr/epSos.de

Nykaa.com, run by FSN Ecommerce Ventures Pvt. Ltd, is eyeing a near three-fold jump in revenue and is looking to expand its private label offering, as the online retailer of fashion and beauty products looks to turn profitable in the next 10-12 months.

The firm, which will end this year with sales of Rs.80-100 crore, is likely to report a revenue of Rs.240-300 crore by March 2017, said founder Falguni Nayar, a former investment banker.

Nykaa, which raised $9.5 million in October, is also looking to raise Rs.90-100 crore (($14.83 million) in the next 6-10 months to support its private label business and expand into offline stores, Nayar said.

Nykaa on Tuesday introduced its private label products in the bath and bodycare category. The company ventured into private labels with the launch of its nail paints in November 2015.

According to Nayar, Nykaa’s move into private labels was triggered by the push towards improving financial metrics as well as a gap in the market.

“Customers are always looking for choices,” she said. “Therefore this launch of the native Nykaa beauty brand is in line with our long term goal by offering quality products at value for money prices.”

After nail paints and bath and body products,Nykaa is expected to launch its own line of kohl, lipsticks, perfumes and make-up in the next 3-12 month period.

The company expects private labels to contribute about 15% of overall revenues in the next three to four years.

Nykaa has also opened offline stores and currently has one at Delhi airport. It will be opening three more in Mumbai, Bengaluru and Delhi in the next quarter. It expects offline stores to generate 10% of overall revenue by 2020.

Nykaa claims to get about five million monthly visitors on its website and generate 100,000 orders with an average basket size of Rs.1,400. Gross margins across categories range between 8-30%, according to the firm.

The app contributes 50% sales of the company.

Nykaa, which until recently was getting 80% of its business from women, is seeing strong demand from men’s category as well. The company is looking to expand its offering in the men’s segment too, said Nayar.

Popular items sold under this segment are hair care products, anti-dandruff items and the grooming range. With more than 400 brands and 40,000 products, Nykaa is currently available across 900 cities in the country.

Founded in 2012, Nykaa is backed by investors, including the family offices of Marico Ltd chairman Harsh Mariwala and Hexaware Technologies Ltd chairman Atul Nishar.

Also Read:

Indian online beauty retailer Nykaa.com raises raises $9.5m from multiple investors

India: With money becoming scarce, private labels come to the rescue of hyperlocals

India: Beauty services platform Zapluk gets funds from Ex Apple India MD, others

This story was first published in Livemint

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.