Nykaa Q2 Results Disappoint Street Despite 200% PAT Surge; Shares Fall 2%

Nykaa’s Growth Engine Runs Strong, but Valuation Keeps Investors Cautious

Profit and revenue accelerated, yet the market’s response suggests strong growth alone may not settle questions about the stock’s valuation.

Strong growth across earnings and sales

Nykaa’s consolidated net profit rose to about ₹101 crore in the second quarter ended September 30, 2026, from around ₹33 crore in the year-earlier period. Revenue from operations increased 28% to ₹3,006 crore, compared with ₹2,345.98 crore in the September 2025 quarter. The profit increase was substantially faster than revenue growth, although the figures alone do not show how much each business or operating factor contributed.

EBITDA grew 65% year on year to ₹263 crore, and the EBITDA margin widened to 8.7% from 6.8%. That improvement indicates stronger operating profitability during the quarter. For investors, the durability of margin gains matters alongside headline profit growth: one quarter’s increase does not, by itself, establish that margins will keep expanding.

Beauty remains central as fashion margins come into focus

Nykaa’s Beauty vertical recorded GMV of ₹4,454 crore. Consolidated GMV grew 30% year on year to ₹6,151 crore, outpacing revenue growth. GMV measures the value of goods transacted, rather than the company’s recognised revenue, so the two measures should be read together but not treated as interchangeable.

Motilal Oswal Financial Services said pre-festive demand could support both Beauty and Fashion in the following quarter. It identified premiumisation as a support for Beauty growth and margins, while describing improving Fashion margins as important to earnings growth. The brokerage also said Fashion was showing improving growth and sustained break-even. That makes execution in the fashion business a key part of the next stage of the earnings story, rather than a detail that can be overshadowed by Beauty’s scale.

A strong quarter did not remove valuation concerns

The share-price response was subdued against the results. Nykaa opened at ₹363.40, its 52-week high, before falling to an intraday low of ₹343. At 12:45 p.m., it was down 2.12% at ₹347.60. Trading volume reached about 21 million shares, compared with 82,231 in the previous session, while the Nifty 50 was up 2% at 24,438. The divergence shows that a positive earnings report does not guarantee a positive trading session, particularly when expectations and valuation are also in focus.

Analyst views were not uniform. Motilal Oswal retained a Neutral rating and a ₹370 target, saying valuations remained a deterrent and it wanted a better risk-reward profile. Jefferies kept its Buy rating and raised its target to ₹415 from ₹400, citing strong growth expectations and increasing its FY28-29 EBITDA estimates by 5-6%. SBI Securities’ Sunny Agrawal pointed to Nykaa Now, the House of Nykaa portfolio and Superstore productivity as drivers of performance, and said strong growth had been anticipated and was reflected in valuations. These are brokerage opinions, not assured outcomes.

Key Highlights

• Consolidated net profit rose to about ₹101 crore from around ₹33 crore a year earlier.
• Revenue from operations increased 28% to ₹3,006 crore.
• Consolidated GMV grew 30% to ₹6,151 crore; Beauty GMV stood at ₹4,454 crore.
• EBITDA rose 65% to ₹263 crore, with margins improving to 8.7% from 6.8%.
• Shares were down 2.12% at 12:45 p.m. despite the strong quarterly growth.
• Brokerage views diverged, with valuation and Fashion margins among the issues investors may monitor.

Investor Note: Nykaa’s results show momentum in sales, GMV and operating profitability, but investors may want to assess whether margin improvement can continue and whether growth justifies the valuation. Broker target prices reflect differing assumptions and should not be treated as guarantees.