Nykaa IPO: Investors’ money rained on Nykaa’s IPO

Nykaa IPO: The issue of FSN E-Commerce Ventures, the operator company of Nykaa and Nykaa Fashions, closed on November 1. It was subscribed 82 times till its last day. The issue of the company opened on October 28. 216.5 crore bids have been received against 2.64 crore equity shares of the company. Nykaa’s gray market premium has now come down to Rs 570

The reserve share for retail investors is 12.06 times. While NII has bid 112.02 times and QIB has bid 91.18 times its share. Whereas the reserve share for the employees of the company has been bid 1.87 times.

What’s going on GMP?

According to market experts, the gray market premium of Nykaa has now come down to Rs 570. The issue price of Nykaa is Rs 1085-1125. Accordingly, the unlisted shares of the company are trading at Rs 1695 (1125 + 570) in the gray market.

A day before the issue opens, Nykaa has raised Rs 2400 crore from anchor investors. Anchor investors had bid 40 times more than Nykaa had reserved the portion for anchor investors.

Nykaa’s parent company FSN E-Commerce Ventures had reserved shares worth around Rs 2,400 crore for anchor investors. Investment firm BlackRock Capital Group and asset manager Fidelity made the biggest bid for these shares. Apart from this, many big global institutional investors including Canada’s largest pension fund manager CPPIB and Singapore’s sovereign wealth fund GIC participated in this bid.

In the last financial year, the company’s revenue increased to Rs 2,441 crore and made a profit of Rs 61.9 crore.
The company’s mobile apps had around 4.37 crore downloads by the end of March. Purchases made through mobile apps account for more than 86 percent of its online gross merchandise value.

Nykaa IPO:Investors' money rained on Nykaa's IPO
Nykaa IPO:Investors’ money rained on Nykaa’s IPO

What was the advice on Nykaa IPO

Anil Singhvi, Managing Editor of Zee Business had advised to subscribe to this IPO for long term and listing gain. He says that this is a new age business company, which people are liking. The growth of the company is very strong. Promoters have a good track record. Nykaa is a cash rich company and has become profitable. The recall value of the brand is good. The company has started spending on advertisements again. However, it is important to see the long-term track record of profits.

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