Nykaa, an online marketplace for fashion and beauty products, is using non-convertible debentures to raise Rs 125 crore, or roughly $15 million.
In order to raise Rs 125 crore in a dematerialized form through a private placement, the board of Nykaa has resolved to issue up to 12,500 non-convertible debentures (NCDs) at an issue price of Rs 1,00,000 each, according to the disclosure submitted to the National Stock Exchange.
The debentures will be issued to a foreign portfolio investor, the disclosure stated. Nykaa, however, withheld the investor’s identity.
Though Nykaa did not reveal why it was raising debt, it intends to invest $2.5 million in one or more tranches in Nysaa Beauty, a subsidiary located in the United Arab Emirates. The company consists of Earth Rhythm as one associate and fourteen subsidiaries.
The bulk of Nykaa’s income comes from the online sales of cosmetics, personal care, apparel, and other goods and services.
Operating revenue for Nykaa increased by 24.1% from Rs 5,144 crore in FY23 to Rs 6,386 crore in FY24. From Rs 21 crore in the previous fiscal year to Rs 40 crore in FY24, the company reported a 90.5% increase in profit.
For the first quarter of FY25, the company anticipates growth of 22-23%.
New employee stock option (ESOP) options for Nykaa’s staff were also announced ahead of the Q4 results. The aim of broadening the pool of ESOPs was to encourage employee ownership and to draw, retain, and inspire talent in tandem with business expansion.
