Nykaa shares rally 4%, hit 52-week high after Q4. Here’s what Goldman Sachs, Morgan Stanley are saying

Shares of FSN E-Commerce Ventures, Nykaa’s parent company, rallied 4.3% to their 52-week high of Rs 285.65 on the BSE on Friday after it reported a consolidated net profit of Rs 78 crore for the March quarter of FY26, marking a 286% jump from Rs 20 crore in the same period last year. The profit after tax is attributable to the parent company’s equity shareholders.

Revenue from operations during the quarter rose 28% year-on-year (YoY) to Rs 2,648 crore, compared with Rs 2,062 crore in Q4FY25. On a sequential basis, PAT increased 24% from Rs 63 crore in the December quarter, although revenue declined 7% quarter-on-quarter from Rs 2,873 crore reported in Q3FY26.

For the full year FY26, the company’s net profit nearly tripled to Rs 199 crore from Rs 66 crore a year earlier. Annual revenue climbed 26% to Rs 10,022 crore, against Rs 7,950 crore in FY25.

Nykaa also posted a 28% YoY rise in gross merchandise value (GMV) to Rs 5,241 crore in the March quarter, extending its streak of mid-20s GMV growth to the 14th straight quarter. The company reported that quarterly revenue and gross margin were the highest seen in the last 12 quarters.

EBITDA for the quarter stood at Rs 223 crore, up 67% from a year ago, accounting for 8.4% of net revenue.

Nykaa shares: Buy, sell or hold?

Morgan Stanley maintained its “Overweight” stance on Nykaa with a target price of Rs 286 (4.3% upside). The brokerage noted that management indicated strong trends continuing through April and May and added that artificial intelligence initiatives are helping improve both topline growth and cost efficiencies. It also sees improving marketing efficiency in the fashion business.

Goldman Sachs maintained its “Neutral” rating on Nykaa and raised the target price to Rs 255 from Rs 240 following the company’s March quarter results. The brokerage highlighted that Q4 NSV and revenue grew 31% and 28% year-on-year, respectively, while EBITDA margin improved to 8.4%. Goldman Sachs also noted that the fashion business achieved EBITDA breakeven ahead of expectations and said it was encouraged by the scaling up of Nykaa’s own brands. According to the brokerage, the company’s verticalised approach and investments in faster deliveries are supporting growth momentum. Following the results, Goldman Sachs raised its EBITDA estimates by 2-4%.Elara Securities retained its “Accumulate” rating on Nykaa and increased the target price to Rs 300 from Rs 270. The brokerage expects the beauty and personal care GMV to grow at a 24% CAGR over FY26-28E and noted that Nykaa continues to maintain market share despite increasing competition from quick commerce platforms. However, Elara said near-term margin expansion could remain limited due to the company’s reinvestment strategy. It expects quick commerce contribution to online beauty and personal care sales to rise to 24-25% over the medium term. The brokerage also highlighted improving momentum in the fashion business, with breakeven expected to support return ratios. Elara expects return on invested capital (ROIC) to improve from 20.3% in FY26 to 44% by FY28.

JM Financial maintained its “Buy” rating on Nykaa with a target price of Rs 335. The brokerage expects consolidated EBITDA to grow at a CAGR of around 50% over FY26-29, driven by margin expansion in both the beauty and personal care as well as fashion businesses. JM Financial expects BPC margins to rise to over 13% from 9.6% in FY26, while fashion margins are projected to improve to around 7% from negative 2.6% in FY26. The brokerage said this margin trajectory is likely to help Nykaa sustain its position as a high-earnings-growth compounding story. Its March 2027 target price implies a valuation of nearly 53 times FY28 estimated EBITDA.

Commenting on the performance, Nykaa CEO Falguni Nayar said crossing the $1 billion revenue milestone while maintaining profitability and capital efficiency marks a significant milestone in the company’s 14-year journey and reflects strong consumer trust in the brand.

She said Nykaa has transformed into a multi-engine growth platform over the last three years, with its Beauty and Fashion businesses doubling their GMV, while newer verticals such as Superstore and House of Nykaa have expanded fourfold during the same period.

Nayar added that the company now serves more than 55 million consumers, whom she described as among the most engaged and premium customers in India. As Nykaa continues to scale its Beauty and Fashion businesses, the company is also focusing on Wellness as a future growth opportunity, while remaining optimistic about the long-term potential ahead.

She also highlighted the growing role of artificial intelligence (AI) in consumer businesses, saying AI is helping Nykaa improve personalisation, efficiency, and scalability in serving customers.

Nykaa shares have risen 36.5% in the last year.

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