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Lifestyle Ecommerce Startup Nykaa Eyes $4 Bn Valuation In IPO

Falguni Nayar led Nykaa is expected to file its DRHP soon

The startup has already converted itself to public company

Reports suggest that the startup is looking to size its public offering at between $500 Mn and $700 Mn

Lifestyle ecommerce platform Nykaa which is gearing to go public in the coming months is expecting a valuation of more than $4 Bn. Falguni Nayar-led Nykaa is in line with other Indian startups such as Cartrade, Paytm, Mobikwik, Policybazaar, Droom that will be going public in months to come.

As a mandatory process before filing the DRHP, the startup has already converted itself into a public company. As per the regulatory filing, the equity shareholders of the startup in a meeting on July 16 have passed a resolution to change the name of the company from FSN E-Commerce Ventures Private Limited to FSN E-Commerce Ventures Limited. 

As per a Bloomberg report, Nykaa is expected to file its DRHP in the coming days eyeing a $4 Bn in valuation

The company in its filing said that it is proposing to undertake an initial public offer of its equity shares of face value of INR 1 each by way of fresh issuance of equity shares along with an offer of sale from existing and eligible shareholders. As per Livemint, the startup is looking to size its public offering at between $500 Mn and $700 Mn. 

Founded by former investment banker Nayar in 2012, Nykaa has managed to emerge as a go to ecommerce platform for fashion products. The company competes against the likes of heavily invested companies such as Amazon, Myntra, Flipkart, Big Basket, among others. The Mumbai-headquartered startup entered the unicorn club in December last year after it raised around $13.6 Mn from its existing investor Steadview Capital. 

The funds were raised as part of Nykaa’s Series F funding round. According to Crunchbase, the startup to date has raised a total of $341.9 Mn from investors such as TPG Growth, Lighthouse Funds, and Fidelity Management and Research Company, among others. The startup has also acquired Pipa.Bella earlier this year and 20Dresses in 2019.

Nykaa has turned profitable since FY19 when it recorded a revenue of $159 Mn. The startup’s expenses clocked at $158.6 Mn leading to a profit of $316K in FY2019. It maintained the same growth in FY2020 as well, with revenues increasing 60% to $254 Mn. 

At present Nykaa boasts of 15 Mn registered users and delivers 1.5 Mn orders per month. Vijay Shekhar Sharma led Paytm which will be raising INR 16,600 Cr is eyeing for a whopping $25 Bn – $30 Bn in valuation. Gurugram-based payment startup Mobikwik which has filed for INR 1,900 Cr IPO is looking at $1 Bn valuation.

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