Nykaa profit jumps 226% as margin expansion extends into Q1FY27
Revenue growth outpaced expenses, but a higher sequential tax rate limited net-profit growth to 1.28%; the results were filed after market close.
Filed 04 Aug 2026, 16:14 IST · after market close · FSN E-Commerce Ventures Ltd (NYKAA)
Key takeaways
- Consolidated net profit rose 225.95% year on year as revenue grew 29.10% and the operating margin widened 1.95 percentage points.
- The operating margin reached a fifth straight quarterly high at 8.48%, but remained 4.45 percentage points below the 12.93% median for 75 reported Consumer Discretionary peers.
- Quarter-on-quarter profit growth slowed to 1.28% as the tax rate rose 3.05 percentage points, despite revenue increasing 5.05% and operating profit 5.89%.
Price around the results
Beauty growth and retail expansion lifted Q1 revenue
Consolidated revenue grew 29.10% year on year and 5.05% sequentially, while expenses rose more slowly at 26.40% and 4.98%, respectively. Management said beauty growth accelerated on platform performance, the Pink Summer Sale and customer acquisition, while retail benefited from network expansion and double-digit same-store sales growth. The company said it added 11 stores in the quarter, taking the network to 324 stores across more than 100 cities.
Operating leverage widened the margin, but tax diluted sequential profit growth
Because revenue grew faster than expenses, operating margin expanded 1.95 percentage points year on year and 0.06 percentage points quarter on quarter. Interest expense fell 11.34% year on year, while depreciation increased 17.49%, indicating that depreciation remained a larger offset to operating profit. Net profit growth was also flattered year on year by a 5.77-percentage-point reduction in the tax rate; sequentially, the tax rate rose 3.05 percentage points and limited net-profit growth to 1.28%. Other income contributed 7.21% of pre-tax profit, so it was not the main source of earnings.
Margin has risen for five straight quarters but still trails peers
The operating margin has increased every quarter from 6.47% in Q4FY25 to 8.48% in Q1FY27, extending the improvement into a fifth consecutive quarter. Even after that progression, Nykaa's margin was 4.45 percentage points below the 12.93% median among 75 Consumer Discretionary peers that had reported. The company's margin ranked 21st from the bottom in that comparison.
Nykaa Now coverage and store rollout remain the stated expansion focus
Management said Nykaa Now expanded from three cities in Q1FY26 to 13 cities in Q1FY27 and is planned to reach more than 25 cities by the end of FY27. The company also said it opened its largest-ever ultra-luxe store in Vasant Kunj. Its presentation said a virtual closet initiative is being used to convert browsers into buyers, alongside new tools for retailer visits and business-development prioritisation.
No post-results move is reported yet
The consolidated results were filed after market close, so there is no reported market reaction yet. Across eight previous result reactions, the stock rose five times and fell three times, with a median absolute move of 4.29%.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,782 cr | ₹2,648 cr | +5.05% | +29.10% |
| Other income | ₹9 cr | ₹9 cr | +1.75% | -0.21% |
| Expenses | ₹2,546 cr | ₹2,425 cr | +4.98% | +26.40% |
| Operating profit | ₹236 cr | ₹223 cr | +5.89% | +67.79% |
| Operating margin (%) | 8.48% | 8.42% | — | — |
| Interest | ₹27 cr | ₹26 cr | +1.56% | -11.34% |
| Depreciation | ₹89 cr | ₹84 cr | +6.22% | +17.49% |
| Profit before tax | ₹129 cr | ₹122 cr | +6.29% | +195.49% |
| Tax | ₹49 cr | ₹43 cr | +15.50% | +156.76% |
| Net profit | ₹80 cr | ₹79 cr | +1.28% | +225.95% |
| EPS (₹) | ₹0.28 | ₹0.27 | +3.70% | +250.00% |
Operating margin of 8.48% compares with a Consumer Discretionary sector median of 12.93% across 75 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Beauty growth accelerated due to strong platform performance, the Pink Summer Sale and robust customer acquisition.
- Retail performance strengthened through network expansion and double-digit same-store sales growth.
Guidance & outlook
- Nykaa Now is planned to expand to more than 25 cities by the end of FY27.
Expansion
- Nykaa added 11 stores in Q1, reaching 324 stores across more than 100 cities.
- Nykaa opened its largest-ever ultra-luxe store in Vasant Kunj.
- Nykaa Now expanded its coverage from three cities in Q1FY26 to 13 cities in Q1FY27.
New products
- The company launched Cashmere Lip Blur and All new Lip Grip.
- The company launched Dragon Fruit Bounce and Meltie Lip Balm.
New initiatives
- Nykaa launched a virtual closet initiative to convert browsers into buyers.
- Nykaa launched a retailer passport providing instant context for every BDE visit.
- Nykaa introduced smart lead prioritisation and next-best actions for BDEs.
Competition
- The company describes one of its brands as India's largest celebrity beauty brand.
What to watch
- Whether operating margin holds above 8.48% after five consecutive quarterly increases.
- Whether the tax rate moves back below 38.25% after the 3.05-percentage-point sequential increase.
- Progress of Nykaa Now beyond 13 cities toward the company's stated 25-plus-city plan for FY27.