Falguni Nayar’s Nykaa sees record drop in share prices on BSE: Know what investors should do

The share prices of Nykaa, an Indian cosmetic company, have dipped to an all-time low, with the share prices falling 5 percent on Tuesday. This is the fourth consecutive day when the share prices of Nykaa have dipped, taking the company to a new record low on the stock market.

FSN E-Commerce Ventures aka Nykaa stock took a major nosedive on Tuesday, with a steep 5.5 percent drop on BSE. The share prices have been on a downward spiral for the fourth consecutive day today, with more trouble rising for the investors as well as founder Falguni Nayar.

The dip in the Nykaa share prices took place as of 10:20 am on Tuesday there were sell orders of 2,74,561 Nykaa shares on BSE against buy orders of 1,72,090 shares on the exchange. This led to a 5.5 percent drop on the BSE.

While Nykaa investors remain worried and divided on whether to buy or sell their shares in the company, UK-based financial services company HSBC updates its target price on the cosmetics company, with a ‘buy’ recommendation for the shares.

HSBC said in its latest India Equity Strategy note Nykaa’s valuations are more appealing now than ever and this poses a perfect opportunity for investors to buy more stock of the company, which is a major player in the beauty and cosmetics industry.

The note by HSBC said, “We believe Beauty and Personal Care (BPC) and e-commerce are the perfect match and expect a c30% CAGR for the BPC e-commerce market in the coming decade, followed by a subsequent decade of double-digit growth.”

“Nykaa (the brand name for FSN) with its leading scale, reach, and broad product range is a rare combination of profitability and sustainable exponential growth, in our view. We expect revenue to double every two to three years over the coming decade,” it further added.

Many financial firms have predicted a revenue growth for Nykaa in the near future, and many experts have advised investors to hold their place and not sell their stock in the company in a haste, despite the dip in the share prices.

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