Shares of FSN E-Commerce Ventures Ltd, the parent company of , will be in focus during the trading session on Friday amid a reported block deal by Harindarpal Singh and associates. The reports suggest that the pre-IPO investor is likely to offload 1.4 per cent worth Rs 809 crore.
According to the term sheet issued by JP Morgan and Goldman Sachs, the banker for the sale, Harindarpal Singh Banga and wife Indra Banga plan to sell 4.09 crore shares at a floor price of Rs 198 apiece, which represents a 5.9 per cent discount to Thursday’s closing price of Rs 210.
Businessman Harindarpal Singh was an early investor in Indian billionaire Falguni Nayar’s fashion giant FSN E-Commerce Ventures, which owns the fashion and beauty platform Nykaa. He founded The Caravel Group, a global conglomerate primarily engaged in resources trading, maritime services, and asset management. By the end of June 2024 quarter, Harindarpal Singh held a 6.
4 per cent stake in Nykaa's parent. The planned divestment will reduce their holding to approximately 5 per cent. Following the block deal, a 45-day lock-up period will apply to prevent further sales of the shares.
Shares of Nykaa have surged nearly 56 per cent in the last one year, while the stock is up nearly 40 per cent in the last six months. The stock is up 18 per cent in the last one month and it is up 12 per cent in the last five trading sessions. Nykaa reported a consolidated net profit of Rs 13.
64 crore for the quarter ended June 30, 2024, up 152 per cent on a year-on-year (YoY) basis. The revenue from operations for the reporting quarter stood at Rs 1,746.11 crore, which was up by 23 per cent.
Elara Capital believes consolidation of Nykaa Man and the eB2B business in Nykaa BPC will positively impact revenue growth for the BPC business by 7-8 per cent. "However, at an absolute Ebitda level, this impact could be offset by lower margins. Nykaa's BPC segment is trading at fair valuations," it said with an 'accumulate' rating with a target price of Rs 210.
The fashion segment of Nykaa was impacted by fewer wedding days, clocking a mere 1 per cent YoY growth in customer visits. Fashion revenue growth was higher than the GMV growth on the back of lower returns and cancellations and higher ad income, said HDFC Securities post Q1 results with a 'reduce' rating and a target price of Rs 165 apiece..
