NYKAA jumps 11% ahead of quarterly numbers; are the fortunes changing for the investors?

The quarterly numbers are expected to be announced on November 01, 2022.

FSN E-commerce Ventures Ltd, popularly known as NYKAA, is engaged in the business of manufacturing, selling and distribution of beauty, wellness, fitness, personal care, health care, skincare, hair care products and related accessories. The stock had marked a blockbuster listing on the exchanges as the stock opened around 80% premium to its issue price last year. However, ever since hitting its lifetime high of Rs 2573.70, the stock has eroded over 60% of the investors’ wealth in one year. The new-age stocks have been recently hammered down owing to their lofty valuation and uncertain cashflows. The stock hit a fresh 52-week low of Rs 975 level last week as it is expected to see its lock-in period expire in November.

Meanwhile, on Monday, the board of the company revised its recorded date for 5:1 bonus shares, from 3 November to 11 November 2022. With such news, the stock has jumped over 11% amid strong buying sentiment from the market participants.

In its recent quarterly results, the company’s net consolidated profit rose 33% YoY to Rs 4.55 crore as against a net profit of Rs 3.42 crore in Q1 FY2022 while the revenue jumped 41% YoY to Rs 1148 crore. The company maintains its market share in the competitive e-commerce business and is expected to put up good earnings in the upcoming quarterly results.

Technically, the stock has shown a good bounce back from its lifetime low today, but still trades below all its key moving averages. The technical parameters are on a downward trajectory and show poor strength in the stock. It might be too early to say if the stock is likely to go up considering the lock-in period expiry approaches. Also, it needs to consolidate before registering a breakout which can signal a bullish trend.

Currently, the stock of NYKAA is trading at the Rs 1100 level on NSE. Add it to your watchlist to track its further progress.