⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
NYKAA - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 2.5
| Stock Code | NYKAA | Market Cap | 68,799 Cr. | Current Price | 240 ₹ | High / Low | 273 ₹ |
| Stock P/E | 1,071 | Book Value | 5.98 ₹ | Dividend Yield | 0.00 % | ROCE | 6.25 % |
| ROE | 6.10 % | Face Value | 1.00 ₹ | DMA 50 | 251 ₹ | DMA 200 | 232 ₹ |
| Chg in FII Hold | -0.39 % | Chg in DII Hold | 0.37 % | PAT Qtr | 12.2 Cr. | PAT Prev Qtr | 12.9 Cr. |
| RSI | 37.3 | MACD | -5.50 | Volume | 19,72,473 | Avg Vol 1Wk | 58,04,245 |
| Low price | 155 ₹ | High price | 273 ₹ | PEG Ratio | -530 | Debt to equity | 0.08 |
| 52w Index | 72.2 % | Qtr Profit Var | -24.2 % | EPS | 0.22 ₹ | Industry PE | 48.9 |
📊 Core Financials
- Revenue growth: PAT at 12.2 Cr vs 12.9 Cr in previous quarter, showing decline (-24.2 % variation).
- Profit margins: EPS at 0.22 ₹, very low relative to market cap.
- Debt ratios: Debt-to-equity at 0.08, manageable leverage.
- Cash flows: Limited visibility, profitability remains weak.
- Return metrics: ROCE 6.25 %, ROE 6.10 % — modest efficiency and shareholder returns.
💹 Valuation Indicators
- P/E ratio: 1,071, extremely high compared to industry average (48.9), suggests severe overvaluation.
- P/B ratio: Current Price / Book Value ≈ 40.1, very expensive relative to assets.
- PEG ratio: -530, not meaningful due to distorted growth expectations.
- Intrinsic value: Current valuation not supported by fundamentals.
🏢 Business Model & Competitive Advantage
- Operates in e-commerce and beauty retail sector with strong brand recognition.
- Competitive advantage lies in digital-first approach and wide product portfolio.
- However, profitability challenges and high valuation limit financial strength.
📈 Entry Zone & Long-Term Guidance
- Entry zone: Attractive only near 155–180 ₹ levels, closer to 52-week low support.
- Long-term holding: Cautious; suitable for growth-oriented investors, but fundamentals do not justify current premium valuation.
Positive
- Strong brand presence in beauty and lifestyle e-commerce.
- DII holdings increased (+0.37 %).
- Low debt-to-equity ratio (0.08).
Limitation
- Extremely high P/E ratio (1,071) compared to industry average (48.9).
- EPS at 0.22 ₹ reflects weak profitability.
- ROE (6.10 %) and ROCE (6.25 %) are modest.
- No dividend yield.
Company Negative News
- Quarterly PAT declined (12.2 Cr vs 12.9 Cr).
- FII holdings decreased (-0.39 %).
- Technical indicators weak: RSI at 37.3, MACD negative.
Company Positive News
- Strong institutional support from DII investors.
- Brand continues to dominate online beauty and lifestyle retail.
Industry
- E-commerce and retail sector growing rapidly, driven by digital adoption.
- Industry PE at 48.9, far lower than NYKAA’s valuation, highlighting overpricing.
Conclusion
- NYKAA demonstrates strong brand presence but weak profitability and efficiency metrics.
- Valuation is extremely stretched compared to industry peers, limiting upside potential.
- Entry advisable only near lower support levels; long-term holding requires caution unless earnings improve significantly.
I can also prepare a comparative HTML snapshot against peers like Tata Cliq, Myntra, and Amazon India’s retail arm to highlight NYKAA’s relative valuation and strengths.