Shares of FSN E-Commerce Ventures Ltd (Nykaa) are likely to stay in focus after global brokerages Morgan Stanley and CLSA reiterated positive views on the company following a strong second-quarter performance. The stock last traded at ₹246.00.
Morgan Stanley maintained its overweight call with a target price of ₹271 per share, implying an upside of nearly 10% from current levels. The brokerage said Nykaa’s beauty business maintained its momentum with 28% GMV growth, while overall revenue grew 25% and the EBITDA margin stood at 9%. In the fashion segment, GMV growth accelerated to 37%, and losses narrowed to –3.5%, supported by improved operating leverage and reduced marketing spends. Morgan Stanley expects Q3 to remain strong, driven by the festive season, Nykaaland event, and higher sale activity.
CLSA retained its outperform call and raised its target price to ₹298, projecting an upside of around 21% from the current market price. The brokerage highlighted 25% YoY revenue growth and a 125-bps improvement in EBITDA margin for Q2FY26, with EBITDA coming in 4% above estimates. CLSA added that the beauty business posted 27% NSV growth, while the fashion segment delivered 27% YoY NSV growth with 550-bps margin expansion YoY and 270-bps improvement QoQ. It also raised FY26–28 earnings estimates by 2–3% to factor in the improved margin trajectory.
Both brokerages said Nykaa’s diversified portfolio and rising traction across beauty and fashion categories position it well to sustain growth momentum through FY26.
Disclaimer: The above article is based on brokerage reports and is for informational purposes only. It does not constitute investment advice or recommendations to buy or sell any securities.
