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Nykaa Q3 results 2023 are not very positive. In the recently released Nykaa quarterly results, the profits of Nykaa have reduced significantly. Everyone was waiting for Nykaa q3 results date but the results have been very different from the Nykaa expected results. In this video, I covered the business model of Nykaa and why Nykaa has been falling behind recently. Nykaa’s debut on the stock market was phenomenal as Nykaa captured 1 lakh crore in market cap on the first day. But ever since the IPO Nykaa’s share has lost 60% of its market value.
Before the IPO Nykaa was a profitable company. But now the profits for Nykaa are decreasing. Nykaa results are disappointing to some but in order to do the proper Nykaa share analysis, we must learn why Nykaa was profitable in the first place. Nykaa company analysis will tell you that Nykaa solved the problems customers were facing in the beauty and personal care segment.
The first issue solved by Nykaa was that customers didn’t know what products they wanted to purchase. To solve this Nykaa had to educate its customers. It was not only about selling the products, Nykaa was giving much more value to its customers through Nykaa TV, Instagram, its beauty blog, and other mediums. Nykaa amassed a massive following on all these social media channels because of this. This method is known as integrated marketing. Through integrated marketing brands are able to build long-term trust and loyalty with their customers. This is also visible in the Nykaa repeat customer history and retention rate which also look very promising.
Further analysis of the Nykaa Business Model will tell you that the second problem solved by Nykaa was avoiding fake products. Since beauty and personal care products intimately impact the users, it is important to ensure that these products are not fake. Nykaa was not sourcing products from the suppliers and selling to the customers. Nykaa was first purchasing the products and doing a quality check before passing it on to customers. This inventory-led model of Nykaa made it more trustworthy for the customers.
The profits of Nykaa started going down because their competition started increasing. Amazon Flipkart also increased its focus on the beauty and personal care segment. Brands like glam and Purple which are purely operating in the beauty and personal care segment also came up during this time. Nykaa Q3 results 2023 analysis will tell you that because of this increased competition, Nykaa had to suffer. The profitability of Nykaa was going down because of the increasing inflation. Nykaa had to decrease its margins since its suppliers increased the prices but its customers were not willing to pay more for a discretionary product.
The third positive reason for the decrease in Nykaa profits is the opening of new physical stores. The number of Nykaa offline stores increased by 85% over the past two years. Opening a physical outlet is costly for a brand in the first 1-2 years but the profits keep rolling in for them as well. At the end of the video, I’ve shared business takeaways from the Nykaa business story. Hope you find this video valuable and please let me know other topics you’d like me to cover in the future.
I publish meaningful and valuable content on this channel. My aim is to make business news more accessible and easy to grasp. If you find my videos informative and insightful then make sure to subscribe and leave a comment. I’ll see you in the next video
0:00 – Intro
0:20 – Nykaa Latest news
0:39 – Why Nykaa was profitable?
1:58 – Integrated Marketing Benefits
2:36 – Avoiding the fake products
3:42 – Increasing Competition
4:20 – Rising Inflation
5:00- More physical outlets
5:44 – Business Lessons
7:03 – Outro
Not easy to explain this much in just 7 minutes. Kudos to your efforts. I have learned a lot of new things today.
Very nice video!
I look forward to your uploads everyday! Great work Pavan! Really enjoying your content!
You were born to do this. Thank you for sharing your light!
Another reason for continued fall might be low trust among investor community or shareholders giving 5:1 bonus when anchor list shares were unlocked to sell in open market shows that the move taken to just save share price rather than value unlocking.
Hi sir, can you make a similar video on ITC
Another great explainer