FSN E-Commerce Ventures Limited

FSN E - Commerce Ventures Limited

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May 22, 2024

National Stock Exchange of India Limited

BSE Limited

Symbol: NYKAA

Scrip Code: 543384

Dear Sirs,

Subject: Press Release

We are enclosing herewith the press release being issued by the Company regarding the Audited Standalone and Consolidated Financial Results for the quarter and financial year ended March 31, 2024.

This intimation is being submitted pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

We request you to take the above information on records.

Thanking You,

Yours faithfully,

For FSN E-Commerce Ventures Limited

Digitally signed by NEELABJA NEELABJA CHAKRABARTY CHAKRABARTY Date: 2024.05.22 17:19:11 +05'30'

Neelabja Chakrabarty Company Secretary & Compliance Officer

Press Release

May 22, 2024

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Quarter and full year ended March 31, 2024 – Media Press Release

Strong growth in Q4 FY2024 Consolidated GMV of 32% YoY with growth momentum evident across all businesses; Profitability continues to improve with Q4 FY2024 EBITDA growth of 32% YoY and PAT growth of 298% YoY

FSN E-Commerce Ventures Limited (referred as “Nykaa” or the “Company”), today announced its financial results for the quarter and full year ended March 31, 2024.

Financial Highlights:

During the quarter, consolidated GMV grew 32% YoY to Rs. 32,172 million, as all the businesses continue to deliver superior performance. The consolidated revenue from operations continues to grow at a strong pace of 28% YoY, totaling Rs. 16,680 million for the quarter. We continue to drive improvement in profitability. Q4 FY2024 EBITDA stood at Rs. 933 million with EBITDA margin at 5.6%. EBITDA margin adjusted for ESOP expenses, new business (GCC operations) and corporate restructuring expenses expanded to 6.7% for the quarter vs 5.5% a year ago. This adjusted EBITDA growth of 56% YoY was driven by direct and indirect costs efficiencies with fulfilment expense and employee expenses witnessing improvement from last few quarters.
The strong quarter enabled the full year FY2024 consolidated GMV to grow 28% YoY, reaching Rs. 124,461 million. FY2024 Consolidated Revenue grew 24% YoY to Rs. 63,856 million. Full year EBITDA margin grew to 5.4% and stood at Rs. 3,462 million. EBITDA margin adjusted for ESOP expenses, new business (GCC operations) and corporate restructuring expenses for FY2024 was 6.0% vs 5.2% a year ago.

Brief snapshot of quarterly as well as full year financials below –

Q4 FY2024 Financial Highlights Summary:
Revenue from Operations grew 28% YoY to Rs. 16,680 million in the quarter.
Gross Profit grew 23% YoY to Rs. 7,102 million in the quarter. Gross Margin stood at 42.6%.
EBITDA grew 32% YoY to Rs. 933 million in Q4 FY2024. EBITDA margin was 5.6% in Q4 FY2024 vs 5.4% in Q4 FY2023
o Profit before Tax grew 126% YoY to Rs. 196 million in Q4 FY2024
Net Profit for the Period was Rs. 91 million, up 298% YoY
FY2024 Financial Highlights Summary:
Revenue from Operations grew 24% YoY to Rs. 63,856 million in the year
Gross Profit grew 20% YoY to Rs. 27,392 million in the quarter. Gross Margin stood at 42.9%
EBITDA grew 35% YoY to Rs. 3,462 million in FY2024. EBITDA margin was 5.4% in FY2024 vs 5.0% in FY2023
o Profit before Tax grew 80% YoY to Rs. 690 million in FY2024,
Net Profit for the Period grew 90% YoY to Rs. 397 million.

Business Highlights:

Beauty

Nykaa’s Beauty business crossed the milestone of US$1 billion (Rs. 83,409 million) GMV in FY2024, up 25% YoY. The consolidated BPC GMV growth for Q4 FY2024 was 30% YoY , highest growth in the last 6 quarters, with accelerated customer acquisition driving superior order growth. This was a result of superior performance in our core categories of colour cosmetics, skincare and haircare as well as strong offtake of emerging categories such as fragrances and bath & body care.
During the quarter, we exclusively launched Fenty Beauty , one of the largest celebrity beauty brand globally, founded by the global pop-culture sensation Rihanna via Global store. Fenty Beauty chose Nykaa as its partner of choice, given Nykaa’s track record of successfully launching several global and luxury beauty brands in the country, its largest base of premium beauty customers as well the largest assortment of luxury brands in India.
Nykaa has furthered its position as the largest omnichannel beauty retailer in the country. Nykaa’s physical retail footprint as of 31 March 2024 was 187 stores across 68 cities, an addition of 42 stores during the year.
We also recently launched our flagship luxury store in the prime locale of Linking Road in Mumbai spread across ~2500 sq ft. Redefining the art of retailing, the store offers an immersive beauty experience with state-of-the-art beauty tech and holistic beauty services, ensuring a tailored experience for every customer.
Spotlighting the consumer’s favourite beauty brands, Nykaa launched Best in Beauty Awards during the quarter. This one-of-its-kind digital beauty awards, recognises excellence, celebrate consumer trust, encourage innovation and honour the best of global & homegrown brands within the beauty ecosystem.

Press Release

May 22, 2024

Fashion

Our Fashion business has deepened its position as a premium women’s fashion destination this year. Nykaa F ashion GMV witnessed growth of 27% YoY in FY2024 and a growth of 27% YoY in Q4 FY2024 . This was a result of high growth across our core categories of women’s Indian wear and western wear as well as ramping up of emerging categories like lingerie and active wear. Our annual unique transacting customer (AUTC) grew at 20% YoY to 3.0 million, while order growth stood at 16% YoY for the full year.
Our fashion business is showing consistent improvement in profitability reflecting our platform strength and quality of our customers. Contribution margin as a % to NSV for Nykaa Fashion improved to 4.9% in FY2024 vs 2.2% in FY2023. This was supported by strong improvement in fulfilment and marketing expenses.

Owned Brands

Our owned brands in FY24 have crossed Rs. 15,000 mn – constituting a significantly scaled business across mature, mid-size and up & coming brands in Beauty and Fashion.
Our owned brands in beauty have grown 39% in FY2024. Dot & Key – our new age D2C skin care brand , which was acquired in September 2021, is now at ~Rs. 6 billion GMV run rate (Q4 FY2024 annualised), scaling 10x since its acquisition. Dot & Key is among the top skincare brands across all platforms and has several bestsellers across key categories of moisturiser, sunscreen and lip balms.
Nykaa Fashion’s house of brands continue to scale well across Nykaa Fashion as well other online and offline channels, and now contributes 12.7% to our overall fashion GMV. Our athleisure and lingerie brand “Nykd”, has strong consumer connect and innovation. Nykd has been scaling very well – growing 14x in 3 years of its launch with Q4FY24 annualised GMV run rate of ~Rs. 1.7 billion.

Superstore by Nykaa

Nykaa distribution business - Superstore by Nykaa has now well established its unique position of being India’s only specialized beauty B2B platform. Superstore serves over 1.95 lakhs transacting retailers and has expanded to over 1,000 cities, a significant accomplishment for a 2 year old business.
Superstore witnessed strong GMV growth of 84% YoY in FY2024. Q4 FY2024 GMV growth was 81%. Superstore’s GMV of Rs. 5,973 million in FY2024, is now a meaningful share of Nykaa’s business. NSV growth of 120% YoY, exceeded GMV growth with significant reduction in pre-delivery leakages.
The distribution business has achieved scale with improving profitability as contribution margin (as a % to NSV) improved 919 bps YoY, from -27.4% in FY2023 to -18.2% in FY2024 . This is supported by several initiatives including increasing share of ad income, and optimization of fulfilment and selling & distribution expenses.

Nysaa

During the quarter, we successfully launched our omnichannel beauty platform – “Nysaa” in the GCC region. GCC has the highest BPC per capita spend of US$500+ and offers Nysaa an opportunity to replicate Nykaa’s successful omnichannel playbook.
We launched our ecommerce platform, Nysaa.com in this quarter along with the launch of our first Nysaa store at City Centre Mirdif, Dubai. Nysaa Beauty Store presents a curated selection of renowned international brands, including Kylie Cosmetics, Kay Beauty, Rituals, Stila, Augustinus Bader, Foreo, Ralph Lauren, Mugler, Rahua, Oribe, Dr. Barbara Strum, and an array of other prestigious names.
Nykaa, through its subsidiary FSN International, is making an investment of up to US$1.9 million into Nysaa. This constitutes the planned investment into Nysaa for FY25.

Other announcements

The Company’s board has approved group business restructuring initiatives towards bringing operational synergies by streamlining business operations across entities.

Acquisition of Western Wear and Accessories business by way of slump sale from Nykaa Fashion Limited to FSN E-Commerce Ventures Limited: After the successful completion of phase one in which Athleisure and Lingerie business of Nykaa Fashion Limited (a wholly owned subsidiary of the Company) was transferred into FSN E-commerce Ventures Limited, the board has now approved to similarly consolidate the Western Wear and Accessories business of Nykaa Fashion Limited into the company. This will help streamline and consolidate owned brand business in a single entity, similar to beauty owned brands business which are already within FSN E-commerce Ventures Limited.
Merger of Iluminar Media Limited into Nykaa Fashion Limited: The board has given the in-principle approval to amalgamate Iluminar Media Limited (LBB) with Nykaa Fashion Limited. This will help consolidate our content creation and events business in a single entity. The proposed merger will drive synergies in technology infrastructure, collaboration with brand partners as well as the content creation/marketing for all our businesses. The scheme is subject to necessary regulatory and stakeholder approval.

Appointment of Independent Director - Santosh Desai

The Board of Directors of the Company, based on the recommendation of the Nomination and Remuneration Committee and subject to the approval of the shareholders, appoints Santosh Desai as an independent director with effect from July 15, 2024. An IIM-Ahmedabad graduate, Santosh served as the CEO of Future Brands Ltd. He has also served as the President of McCann-Erickson, one of India’s premier advertising agencies. Having spent 21

Press Release

May 22, 2024

years in advertising, he is a veteran in the domain and has been involved in strategically building many key brands for numerous local and multinational organizations.

Our recent CSR initiatives

Nykaa recently entered into a 3-year association with America India Foundation (AIF) to equip more women with the resources to follow their true passion into STEM education. This association will allow us to enable access to higher quality of education, resources, mentorship & guidance- thus creating a conducive environment for their curiosity to be nurtured and their dreams to be heard.
Through our partnership with Sambhav Foundation, we launched the Labournet program in 2023 which specializes in the training of young women for self-employment in the beauty and grooming industry. The labournet program currently operates 5 centres across the country and over 400 candidates have been certified and over 70% of them have started earning a stable income.
Focusing on Education, Nykaa has instituted a Chair in Consumer Technolog y at IIM Ahmedabad to focus on research and education that will promote the scientific practice of marketing, and present insights on the impact of digital, social, and mobile technologies on business models, customer behaviour, and social changes.

Nykaa through its CSR program aims to be a champion of authentic self-expression and one that inspires positive change. The company through its consultative and inclusive approach identifies the specific needs of marginalized and vulnerable, and develops targeted CSR programs that empower these groups.

Our Consolidated results include results of wholly owned subsidiaries along with Kay Beauty, Dot & Key, Nudge, LBB and associate Earth Rhythm.

About Nykaa:

At Nykaa, we share one vision- to bring inspiration and joy to people everywhere, every day. Born out of a desire to make beauty a mainstream choice, the Nykaa journey began in 2012 as a digitally native, consumer-tech company. Falguni Nayar’s entrepreneurial leap with Nykaa, tapped into an underserved beauty retail market, disrupting the ecosystem and putting India in the global spotlight. Today, Nykaa has expanded its offerings to include lifestyle and B2B by introducing online platforms Nykaa Fashion, Nykaa Man, and Superstore.

Over the years, Nykaa has steadily captured the hearts of Indian consumers, ushering visits to both its online and 187 offline destinations and building loyal communities through engaging and educational content. Nykaa continues to build its house of brands with a sharp focus on innovation and consumer delight. Beauty brands such as Kay Beauty, Nykaa Naturals, Nykaa Cosmetics, and Wanderlust and fashion brands such as Nykd, Gajra Gang, Likha, RSVP and Pipa Bella, have become household names, as they consistently deliver on inspiration and high performing products to the consumers.

Nykaa’s unwavering commitment to authenticity and customer centricity has made it the retailer of choice for international brands entering India. Nykaa’s Global Store, a gateway into the world of coveted international brands, leverages the company’s proven supply chain and marketing capabilities to offer a truly seamless shopping experience.

For its role in building India’s beauty and lifestyle retail markets, Nykaa has been awarded several Indian and International accolades and was proudly featured in the TIME100 Most Influential Companies List.

For media enquiries, please contact [email protected]

About Santosh Desai:

An IIM-Ahmedabad graduate, Santosh served as the CEO of Future Brands Ltd. He has also served as the President of McCann-Erickson, one of India’s premier advertising agencies. Having spent 21 years in advertising, he is a veteran in the domain and has been involved in strategically building many key brands for numerous local and multinational organizations.

Connecting culture and marketing, Santosh is the very definition of ‘brand guru’. A lively speaker, he has the ability to explain the most complex concepts through the simplest, everyday references. He enjoys connecting and sharing ideas with a variety of audiences across a multitude of platforms. He has served as a guest lecturer at various national and international universities and has addressed global management boards of global companies.

He was on the boards of ING Vysya Bank and OXFAM India and is currently on the boards of Think9 Consumer Technologies Pvt Ltd, D.B. Corp. Ltd and Breakthrough. He is also a member of the Governing Councils of Mudra Institute of Communication, Ahmedabad & Praxis Business School, Kolkata. He has been writing a weekly column in the Times of India for over 19 years and is the author of the

bestselling Mother Pious Lady-Making Sense of Everyday India, a book that examines how the everyday life of middle-class India has evolved.

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FSN E-Commerce Ventures Limited Earnings Release 2024

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National Stock Exchange of India Limited

BSE Limited

Subject: Press Release