Nykaa to expand rapid delivery service to more metros as quick commerce takes off
Bengaluru: FSN E-Commerce Ltd, the parent company of beauty e-tailer Nykaa, will expand its rapid delivery service to more metro cities, anticipating promising growth in the segment as consumer adoption widens.
There has been relatively good traction, and a good percentage of the company's orders are serviced through Nykaa Now, the framework that ensures delivery within 60 minutes, said Anchit Nayar, executive director and chief executive officer of Nykaa's beauty business.
'There is a plan to expand it to several other metros in the coming months,' Nayar said during the Q4 earnings call on Friday.
The Mumbai-based company began pilot projects of Nykaa Now in select parts of Mumbai in October. Through its network of 'rapid warehouses', the service delivers beauty and personal care products in 60 minutes to three hours.
According to Nayar, the company's key differentiator lies in what he called the largest assortment of beauty products available in the rapid delivery network.
'We've made a lot of our assortment available for Nykaa Now and that's really been a big differentiator to the consumer to have that power of choice, which is still not as well developed on some of the other rapid delivery platforms that are out there,' the executive said.
The company does not rely on its network of physical stores to fuel rapid deliveries, although it sees an opportunity in using them to fulfil hyperlocal delivery.
'We do have the capability of using our physical stores to service e-commerce orders in the relevant pin code. But our stores are experiential stores, and it doesn't make much fiscal sense to use them as warehouses,' Nayar added.
In November, Nykaa had highlighted that its investments in setting up rapid warehouses are expected to stay lean, noting that the high average order values in beauty e-commerce allow the company to expand its logistics efficiently and profitably.
The gross merchandise value (GMV) of Nykaa's beauty business jumped 30% to ₹ 11,775 crore in FY25. GMV in the January-March quarter climbed to ₹ 3,058 crore from ₹ 2,339 crore in the year-ago period.
Revenue from Nykaa's fashion arm grew 19% to ₹ 675 crore in FY25 while its GMV was ₹ 3,804 crore from 3,385 crore in the previous year, hurt by the muted performance of its own brands and lower marketplace and service income.
Nykaa's revenue from operations increased 24% to ₹ 2,062 crore in the fourth quarter, while profit after tax rose to ₹ 19 crore from ₹ 9 crore a year earlier.
FSN E-Commerce shares fell 1.81% to ₹ 200.80 at the close on the National Stock Exchange before the results were announced.
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