Nykaa to raise $15 Mn via non-convertible debentures

Online fashion and beauty commerce platform Nykaa is raising Rs 125 crore (approximately $15 million) via non-convertible debentures.

The board at Nykaa has passed a resolution to issue up to 12,500 non-convertible debentures (NCDs) at an issue price of Rs 1,00,000 each to raise Rs 125 crore in a dematerialized form on a private placement basis, the disclosure filed with National Stock Exchange shows.

The disclosure added that the debentures will be issued to a foreign portfolio investor. However, Nykaa didn’t disclose the investor's name.

While Nykaa did not disclose the purpose of raising debt, it has plans to invest $2.5 million in its UAE-based subsidiary Nysaa Beauty in one or more tranches. The firm has 14 subsidiaries and one associate named Earth Rhythm.

Nykaa draws majority of its revenue from the sale of beauty, personal care, fashion and other products and services through various platforms. 

Nykaa’s revenue from operations grew 24.1% to Rs 6,386 crore in FY24 from Rs 5,144 crore in FY23.  The firm reported a 90.5% increase in profit to Rs 40 crore in FY24 from Rs 21 crore in the previous fiscal year.

The company has projected 22-23% growth for the first quarter of FY25.

Ahead of the Q4 results, Nykaa also announced fresh employee stock option (ESOP) options for its employees. The objective of expanding the ESOP pool was to promote employee ownership and as well as to attract, retain, and motivate talents in line with corporate growth.