Nykaa‘s shares were dropping on Friday following reports that a large investor would likely sell a stake in the online beauty brands retailer via a block deal.

What Happened: Lexdale International is reportedly planning to divest 2.62 crore shares in Nykaa through block deals, CNBC-Awaaz reported, citing sources familiar with the matter.

The total value of the block deal is estimated to be ₹490 crore. The lock-in period for this deal is set at 45 days, and brokerage firms Morgan Stanley and JP Morgan are reported to be the brokers for the deals.

Profit Taking? In the second quarter ended September 2023, Nykaa reported a significant increase of 50% in consolidated net profit, reaching ₹7.8 crore compared to ₹5.2 crore in the same period a year ago. The company also saw a 22.4% growth in consolidated revenue from operations to ₹1,507 crore from ₹1,230.82 crore a year ago.

See Also: Paytm Founder Touts Perplexity AI As Superior To ChatGPT, Bard For Certain Use Cases: Here’s Why

Despite a delay in the festive season compared to the previous year, Nykaa’s revenue from operations increased by 22% to ₹1,507 crore in the quarter. The consolidated beauty and personal care gross merchandise value rose by 23% year on year, with a net sales value growth of 19% year on year.

Nykaa highlighted that its physical retail business continued to expand post-COVID-19, with the launch of 13 new stores in the quarter, bringing the total number of stores to 165 as of September 30, 2023. The retail business now constitutes 8% of the overall beauty and personal care gross merchandise value. Nykaa’s brands in beauty experienced a net sales value growth of close to 21% year-on-year.

In the fashion business, the consolidated revenue amounted to ₹130.5 crore, reflecting a 28% increase on a year-on-year basis. This growth was attributed to a strong 32% year-on-year increase in the number of annual unique transacting customers, which reached 2.8 million as of September 30, 2023.

Price Action: Nykaa’s share price was down 1.58% at ₹190.55 near the start of trade on Friday.

Read Next: ByteDance To Shut Down Music Streaming Service Resso in India: Report