Nykaa earnings growth is drawing attention as the beauty and lifestyle retailer builds on strong performance in its core Beauty and Personal Care (BPC) business while working to improve profitability in its fashion segment. In a research report dated 19 October 2026, Anand Rathi Research initiated coverage on Nykaa with a BUY rating and a 12-month target price of ₹400.

The report highlights Nykaa’s expanding beauty customer base, premium brand partnerships, growth in its owned beauty brands and improving operating economics in fashion. These factors underpin the brokerage’s positive outlook on the company’s long-term growth potential.

Nykaa Earnings Growth Supported by Its Beauty Business

Nykaa’s Beauty and Personal Care segment remains a key driver of growth and profitability. According to Anand Rathi Research, BPC gross merchandise value (GMV) increased approximately 27% year-on-year in FY26 to around ₹91 billion.

The company’s beauty customer ecosystem also expanded to more than 42 million users, reflecting its established position in India’s online beauty market.

Key growth drivers include:

Premiumisation: Rising demand for premium beauty and personal care products.

Brand partnerships: Exclusive partnerships that help differentiate Nykaa’s product selection.

Online adoption: Increasing consumer preference for digital beauty shopping.

Owned brands: Expansion of Nykaa’s in-house beauty portfolio.

Operating leverage: Potential improvement in profitability as the business scales.

Together, these factors support the brokerage’s view that the beauty business can remain an important contributor to Nykaa’s financial performance.

Nykaa Fashion Profitability Remains a Key Focus

While beauty remains Nykaa’s core growth engine, improving fashion profitability is another important part of its business strategy.

Nykaa entered the fashion segment in 2018 and has developed a curated offering focused on premium and trend-led products. However, profitability has been a challenge amid competition, customer acquisition costs and discounting across online fashion platforms.

Anand Rathi Research sees improving unit economics in Nykaa Fashion as a potential contributor to the company’s earnings outlook.

The key factors to monitor include:

Progress in fashion segment profitability.

Customer acquisition and retention costs.

Average order value and order growth.

Competitive pressure from established fashion marketplaces.

The balance between growth, discounting and margins.

Sustained improvement in these areas could strengthen Nykaa’s overall earnings profile.

House of Nykaa Brands Add Another Growth Opportunity

Nykaa’s owned beauty portfolio is an additional area of focus. The House of Nykaa portfolio includes brands such as Dot & Key, Kay Beauty and Nykaa Cosmetics.

According to the research report, the portfolio’s net sales value reached approximately ₹17 billion in FY26, compared with around ₹5.1 billion in FY23.

The portfolio gives Nykaa an opportunity to build brand recognition, develop differentiated products and participate in the value created by its own brands.

However, continued growth will depend on consumer demand, product innovation, brand strength and the company’s ability to maintain healthy margins in a competitive beauty market.

Anand Rathi’s Nykaa BUY Rating and ₹400 Target Price

Anand Rathi Research initiated coverage on Nykaa with a BUY rating and a 12-month target price of ₹400. The brokerage’s valuation is based on 50 times estimated FY29 EBITDA.

The report points to Nykaa’s position in online beauty, its portfolio of premium and exclusive brands, the growth of its owned beauty businesses and improving fashion unit economics as factors supporting its valuation outlook.

The target price and BUY rating represent the brokerage’s assessment as of the report date. They are not a guarantee of future share-price performance.

Key risks highlighted in the report

Despite the positive outlook, Nykaa faces several risks that could affect its growth and profitability:

Slower consumer demand in discretionary categories.

Higher customer acquisition costs.

Intense competition across beauty and fashion platforms.

Challenges in maintaining a fresh and attractive beauty assortment.

Slower-than-expected improvement in fashion profitability.

Risks relating to product authenticity.

These factors remain important when assessing Nykaa’s future performance.

Nykaa’s Business Outlook: What to Watch

Nykaa operates across beauty, personal care, fashion and business-to-business distribution through Superstore by Nykaa. Its omnichannel model combines digital platforms with physical retail stores, giving customers multiple ways to discover and purchase products.

Going forward, investors and business observers may track beauty GMV growth, performance of owned brands, fashion margins, customer engagement and the efficiency of its distribution network.

The company’s ability to sustain growth while improving profitability across its business segments will be central to its long-term financial performance.

Conclusion: Nykaa Earnings Growth Depends on Beauty and Fashion Execution

Nykaa earnings growth is supported by momentum in its core beauty business, a growing portfolio of owned brands and the potential for better fashion profitability. Anand Rathi Research’s BUY rating and ₹400 target price reflect its positive assessment of these opportunities as of 19 October 2026. However, competitive intensity, consumer demand and the pace of margin improvement remain important factors to monitor.

Disclaimer: This article summarises an analyst research view for informational purposes only and should not be considered investment advice or a recommendation to buy or sell securities. Investors should review the original research, consider the associated risks and consult a SEBI-registered investment adviser before making investment decisions.