The shares of FSN E-Commerce Ventures, operating Nykaa’s marketplace, climbed on 3rd October just after the company announced a bonus issue of the equity shares. Nykaa said that it would issue shares in the quantity of five shares for every one share held by the company’s shareholders as of the record date. The issue is subject to shareholders’ endorsement by way of postal ballot.

The company has fixed 3rd November as the record date for the resolution of determining members who are eligible for the bonus equity shares. On BSE, the stock traded 8% to Rs 1,370 following the proclamation. The company said it has planned to issue 2,37,27,61,850 equity shares with a face value of Re 1 each to its shareholders.

The definite number of bonus equity shares to be issued will be resolute based on the paid-up share capital as on the record date. Bonus issues do not influence the fundamentals of the company. It just upsurges the number of outstanding shares, and the single share price is consequently adjusted. The stock has performed unwell so far this year. Despite today’s jump, it is in recession by 35 per cent in the current calendar year. Analysts have also been thinking about the stock.

ICICI Securities, which has a ‘hold’ rating on the stock, said. However, Nykaa continues to extant a combination of leading Beauty and Personal Care (BPC) business in a developing market and good profitability metrics; competition will likely strengthen from both vertical and horizontal nobles operational against the company.
“While we expect Beauty and Personal Care (BPC) revenues to nurture, we believe Nykaa’s journey could be changed – it will have to go more mainstream to effort this growth,” the broker said.