Omnichannel beauty and lifestyle retailer FSN E-Commerce Ventures Limited (Nykaa) continued the expansion of its physical store footprint during the second quarter ended September 30, 2026 (Q2 FY27), adding 14 net new stores to bring its national retail network to 338 locations. According to the company’s provisional quarterly business performance update submitted to stock exchanges, consolidated net revenue is expected to grow in the late twenties percent, supported by steady customer acquisition and six-quarter-high like-for-like store productivity.
Shares of Nykaa rose as much as 4.2% to ₹214.80 on the National Stock Exchange (NSE) following the disclosure, reflecting market optimism around sustained demand in its core Beauty vertical and accelerating growth in its Fashion business.
Key takeaways
- Network expands to 338 stores: Nykaa opened 14 net new physical stores during Q2 FY27, expanding its nationwide offline retail network to 338 stores as of September 30, 2026.
- Six-quarter high in store productivity: Like-for-like (LFL) sales growth across mature retail outlets reached the early twenties percent, marking the fastest physical store throughput recorded over the past six quarters.
- Consolidated revenue trajectory: Consolidated net revenue growth is projected to land in the late twenties percent, with consolidated Gross Merchandise Value (GMV) expanding in the early thirties percent.
- Beauty vertical consistency: The core Beauty segment maintained momentum, with Net Sales Value (NSV) and net revenue both expected to expand in the late twenties percent, led by premium fragrance, skincare, and the proprietary House of Nykaa brand portfolio.
- Fashion business accelerates: The Fashion vertical scaled faster than the broader business, with NSV projected to grow in the late forties percent and net revenue rising in the early forties percent, aided by 250+ new brand onboarding partnerships and its strategic tie-up with Nike.
Retail network expansion: The 338-store milestone
While Nykaa originated as a digital-first direct-to-consumer (D2C) marketplace, physical stores have become a vital operational pillar for customer discovery, brand engagement, and cross-channel loyalty.
During Q2 FY27, Nykaa added 14 net new locations, bringing its aggregate store network to 338 physical outlets across India:
NYKAA OFFLINE STORE NETWORK EXPANSION:
Q4 FY26 (Fiscal Year-End Baseline): [██████████████████████████████] ~310 Stores
Q1 FY27 (June 30, 2026): [████████████████████████████████] 324 Stores (+14 net)
Q2 FY27 (September 30, 2026): [████████████████████████████████████] 338 Stores (+14 net)
└─► 28 Net Stores Added in H1 FY27
Nykaa deploys its brick-and-mortar stores across two primary operational formats:
- Nykaa Luxe: Larger-format experiential storefronts carrying international and prestige beauty labels (such as Estée Lauder, MAC, Clinique, Huda Beauty, and Charlotte Tilbury), designed for high-touch consultations.
- Nykaa On Trend: Curated trend-focused stores showcasing viral, mass-prestige, and domestic beauty brands popular on social media channels.
The retail expansion was matched by strong existing store productivity. Like-for-like (LFL) store sales growth reached the early twenties percent, representing the strongest organic store-level sales performance the company has recorded in the last six quarters. This performance suggests that new physical store openings are not cannibalizing sales from existing locations, but rather broadening brand visibility in Tier-1 and Tier-2 catchment areas.
Vertical performance: Beauty stability vs. Fashion acceleration
The operational update revealed a healthy divergence between the predictable, cash-generative Beauty segment and the fast-scaling Fashion arm:
| Operating Segment | Q2 FY27 Projected NSV Growth | Q2 FY27 Projected Net Revenue | Primary Operational Catalysts |
| Beauty Vertical | Late Twenties % | Late Twenties % | LFL store growth, House of Nykaa outperformance, premiumization |
| Fashion Vertical | Late Forties % | Early Forties % | 250+ brand additions, Nike partnership drops, repeat buyers |
| Consolidated Entity | Early Thirties % (GMV) | Late Twenties % | Omnichannel synergies, festive inventory intake |
Source: Compiled from FSN E-Commerce Ventures provisional exchange filings.
PROJECTED Q2 FY27 REVENUE EXPANSION BY VERTICAL:
Beauty Vertical Net Revenue: [██████████████████████████] Late Twenties % (~27%–29%)
Fashion Vertical Net Revenue: [██████████████████████████████████████] Early Forties % (~40%–43%)
Consolidated GMV Growth: [██████████████████████████████] Early Thirties % (~30%–33%)
1. Beauty: Anchored by premiumization and proprietary labels
The Beauty vertical remains Nykaa’s primary profit engine. Both Net Sales Value (NSV) and Net Revenue are slated to print in the late twenties percent. Growth was supported by balanced contributions from new customer acquisition and repeat order frequency.
Notably, the House of Nykaa—the company’s proprietary private-label umbrella spanning Nykaa Cosmetics, Kay Beauty (partnered with Katrina Kaif), Dot & Key, and Nykaa Naturals—outperformed the broader Beauty vertical, delivering higher gross margins and strong shelf-space turnover.
2. Fashion: Scaling through curated merchandising and athletic partnerships
The Fashion vertical delivered an acceleration in top-line throughput, with NSV approaching the late forties percent and net revenue rising in the early forties. The business expanded its catalog depth by onboarding more than 250 new designer and domestic apparel brands during the three-month period.
Additionally, the company’s distribution collaboration with sportswear giant Nike delivered encouraging results, driven by exclusive platform drops, specialized footwear curation, and activewear promotions that attracted younger demographic buyers.
Omnichannel economics: Why physical stores matter for D2C margins
Nykaa’s ongoing expansion to 338 retail stores highlights a broader structural reality in Indian e-commerce: pure digital customer acquisition has become increasingly expensive.
As digital advertising costs across Meta and Google platforms have risen over recent years, digital-native brands have found that running physical stores can reduce customer acquisition costs (CAC) while lifting long-term customer lifetime value (LTV):
THE OMNICHANNEL FEEDBACK LOOP:
[ Physical Retail Storefront (338 Locations) ]
│
├─► Direct In-Person Product Trial & Shade Matching
├─► Organic Footfall Lowers Digital Ad Spend (CAC)
└─► Trust Anchor for First-Time Regional Shoppers
│
▼
[ Increased Cross-Channel Engagement ]
│
▼
[ Customers Repurchase via Nykaa App (Higher LTV & Lower Return Rates) ]
- Trial and shade matching: In cosmetics, skincare, and prestige fragrance, in-person testing, skin-tone analysis, and shade matching significantly reduce product return rates compared to unassisted online purchases.
- Customer lifetime value: Internal company metrics demonstrate that omnichannel shoppers—consumers who buy through both the physical store and the mobile app—spend nearly 2.5 to 3 times more annually than pure online shoppers.
- Regional presence: Expanding outside metro capitals into high-potential Tier-2 markets (such as Chandigarh, Jaipur, Lucknow, and Kochi) allows Nykaa to capture regional wealth while creating localized fulfillment nodes for express logistics.
Broader market context: Outperforming the value-apparel slowdown
Nykaa’s quarterly update stands in contrast to the headwinds reported by several value-focused retail peers during the same quarter.
While discount apparel chains like V2 Retail saw calendar same-store sales decline by 14.9% due to the shifting of the autumn festive season (Navratri and Durga Puja) from September into October, Nykaa maintained growth in the late twenties across its consolidated operations.
The divergence illustrates the resilience of the “lipstick effect” in Indian consumer spending. Premium beauty products, specialized skincare regimes, and mid-to-high-tier fashion labels have shown greater price elasticity and urban insulation from general food inflation compared to entry-level mass apparel, allowing premium lifestyle platforms to navigate calendar shifts with minimal operational friction.
What could happen next
- Audited Q2 FY27 earnings board meeting: Nykaa is expected to report its full audited quarterly financial results in late October or early November 2026, providing verified disclosures on EBITDA margins, marketing expenditures, and fulfillment costs.
- Festive season peak off-take: Because the high-volume festive shopping window (Navratri, Karwa Chauth, Dussehra, and Diwali) falls across October and November, Q3 performance will reveal whether festive channel filling in Q2 translates into strong retail sell-through.
- Store expansion target for FY27: Analysts will monitor whether management updates its annual physical rollout guidance, with the retail footprint on track to approach 370 to 400 stores by the end of the current fiscal year.
Frequently asked questions
How many physical stores does Nykaa operate in India?
As of September 30, 2026, Nykaa operates 338 physical retail stores across India, having added 14 net new locations during the second quarter of FY27.
How much did Nykaa’s revenue grow in Q2 FY27?
According to the company’s provisional business update, consolidated net revenue growth is expected to be in the late twenties percent, while consolidated Gross Merchandise Value (GMV) is projected to grow in the early thirties percent year-on-year.
What is the difference between Nykaa Luxe and Nykaa On Trend stores?
Nykaa Luxe stores are larger retail outlets focused on prestige and international luxury brands with high-touch personal beauty consultations. Nykaa On Trend stores are curated, trend-led spaces designed around popular, fast-moving, and social-media-trending beauty products.
How did the Fashion vertical perform compared to Beauty in Q2?
The Fashion vertical scaled faster in percentage terms, with Net Sales Value (NSV) expected to grow in the late forties percent and net revenue in the early forties percent. The Beauty vertical maintained steady growth, with both NSV and net revenue projected in the late twenties percent.
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