Nykaa share price’s brief recovery march that started this week was halted on Thursday as the stock slumped over 3% as the markets opened for business.

What Happened: The company late on Wednesday released a summary of its Q4 business updates. As per the beauty and fashion retailer, Tier 1 consumers sustained consumption has led to stronger revenue growth on the Nykaa platforms.

Talking about its flagship Beauty & Personal Care (BPC) categories, the omnichannel retailer said that it has seen sustained strong demand, partly aided by the ‘Pink Love' sale introduced during the quarter. “BPC business has seen higher year-on-year growth rates in Q4 FY23 as compared to the year-on-year growth rates seen in Q3 FY23,” the company added in the press release. The tech startup expects percentage revenue growth rates for FY23 to be in line with the ones seen in 9M FY23, early-thirties.

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The company said that the fashion segment however was impacted by the consumer pullback in discretionary spending. For the final quarter of FY23, the company expects percentage revenue growth rates in the Fashion business to come through in the late teens. This comes on the back of the company focussing on improving business efficiency and unit economics. The company also said that its average order values and conversion rates have improved steadily.

However, investors do not seem impressed by the business updates. The stock’s bull run this week was halted on Thursday as the company released the updates. On other hand, analysts were impressed by the Falguni Nayar-led startup. Morgan Stanley maintained its ‘overweight’ rating for the stock with a price target of ₹206. Nomura also maintained its ‘buy’ call for the stock with a price target of ₹214.

Price Action: Nykaa share price was down 2.97% to trade at ₹132.50 shortly after the markets opened on Thursday.

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