Leveraging on the growing e-commerce space in India, online beauty store Nykaa has emerged as one of the country's most established companies in its field.
The website, which started out in 2013, claims to get five million visitors a month and lists well-known Indian and global brands, including in-house products.
The e-commerce company has grown at 300-400 per cent annually since it started operations.
It generated a revenue of Rs 150 crore in 2015 and has set a target of Rs 450 crore for 2016 and Rs 1,000 crore by the end of 2020.
To expand its operations, Nykaa is looking to raise Rs 100 crore in the next 6 months.
"We are looking to raise Rs 90-100 crore in the next 6-10 months to support our private label business and expand into offline stores," said founder Falguni Nayar, a former investment banker with Kotak Mahindra Capital.
Nykaa.Com is also expanding its range of in-house beauty products under the "Nykaa" brand name. This will include bath and body products, nail paints and will be extended to skin care later on.
Nayar said the average basket size is about Rs 1,400 and premium and luxury products are doing well on its platform.
Nykaa has one offline stores at Delhi airport. It will be opening three more in Mumbai, Bengaluru and Delhi in the next quarter. It has set a target to open 30 offline stores which generate 10 per cent of overall revenue by 2020.
Nayar said it will take 8-10 months for the company to reach the break-even point. She said the firm will opt for an IPO once generates enough profit.
"I would prefer a profit of about Rs 70-80 crore before going public," said Nayar, who believes that consumer satisfaction and digital marketing are two most essential things that have contributed to Nykaa’s success.
BW Reporters
The author is Senior Correspondent with BW Businessworld
