Online fashion retailer Nykaa has agreed to acquire digital lifestyle guide Little Black Book for an undisclosed sum.
Nykaa, led by FSN E-commerce Ventures Ltd, will acquire the content-based shopping platform in an all-cash deal at a “mutually agreed pre-cash valuation, subject to closing adjustments,” according to a statement. The transaction is expected to be completed in 60 days.
LBB is backed by venture capital firms such as Blume Ventures, Chiratae, and Dream Incubator.
The online beauty, personal care and fashion company reported a net profit of $Rs 4.5 crore for the quarter ended June, an increase of 32.4% from $Rs 3.4 crore in the previous year due to higher revenues from sources other than its core business.
Other income amounted to $8.4 crore $4.7 crores a year earlier.
Revenues for the June quarter grew 41% to $1,148.4 crores $817 million rupees. On the operational front, Nykaa fared relatively well with its Ebitda expanding 70% to $Rs 45.9 crore vs. $26.9 million rupees.
The company’s Ebitda margin widened to 4% from 3.3% a year earlier.
Tax expenditures, however, increased to $2.7 million rupees against a credit of $37 lakh year-on-year. On Friday, Nykaa shares fell 1.7% to $1,420 in SES.
“Our business continues to grow across all verticals, despite an adverse and challenging macroeconomic environment, demonstrating the strength of our business fundamentals. The beauty vertical, online and offline, is seeing strong growth momentum while driving efficiencies across the value chain,” said Falguni Nayar, Managing Director and CEO of Nykaa.
The company’s beauty and personal care vertical increased its gross merchandise value (GMV) by 39% to $1,489 crore from a year earlier, while its fashion GMV rose 59% to $582 million rupees.
Commenting on investment in new growth verticals, Nayar said in a statement: “We continue to invest in creating a customer proposition in fashion, with developments in platform experience and depth in assortment. The sequential growth of the fashion vertical during the third and fourth quarters comes as a result of this, along with a revival of factors such as mobility and travel.”
Nykaa claims to offer more than 4,000 brands and 3.1 million product stocking units (SKUs) through its website and mobile app. “We remain focused on investing in growth engines, particularly Superstore, Nykaa Man and international operations,” Nayar added in the statement.
On a sequential basis, Nykaa’s net income fell 42.3% quarter over quarter, while headline and operating figures each showed growth of more than 18%.
In a separate presentation on the Little Black Book acquisition, Nykaa said the move is in line with Nykaa’s content-first approach to engaging with its loyal consumer base. The filing does not disclose the financial details of the transaction, which is expected to be completed within 60 days of execution.
LBB, which is operated by Illuminar Media Pvt. Ltd, was founded by Suchita Salwan and Dhruv Mathur in 2015. The startup focuses on audience engagement through content and discovery. It claims to have more than 70 million users. The startup recorded revenues of around $Rs 19.5 crore in FY2020-21.
In LBB’s latest main funding round in 2019, the startup raised $5 million in a Series A round led by Inventus India and IAN Fund in April 2019. Japanese investors Dream Incubator and Akatsuki Entertainment Technology Fund also contributed, by as are existing investors, including Blume Ventures. .
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