Shares of FSN E-Commerce Ventures Ltd (Nykaa) tanked 4 per cent in Monday's trade as March quarter profit fell short of analyst estimates on higher tax rate. Ebitda came in slightly ahead of analyst estimates, BPC growth was on track, and the company's focus stays profitable growth in fashion, analysts said.

On Monday, the stock was trading 3.81 per cent lower at Rs 195.50 on BSE. Nomura India retained its 'neutral' on the stock with a target of Rs 216.

"Nykaa’s focus on onboarding new global brands, expanding stores and product curation should continue to drive strong revenue growth in BPC. But margin improvement thus far has been slow and needs to pick up for us to turn more constructive," it said. 

In Fashion, the focus on improving profitability is positive, especially given the highly competitive segment, it said. 

Nykaa’s ability to deliver robust growth in a tepid demand environment along with margin enhancement demonstrates its differentiated market positioning, JM Financial said. This brokerage reiterated ‘Buy’ with March 2026 target of Rs 250.

For Nykaa, said Nuvama, BPC continued to deliver strong double-digit growth along with improving profitability. The management indicated fashion business shall report demand traction in Q1FY26 as most of the industry headwinds have bottomed out, it said.

"We are cutting FY26E/27E earnings by 6.7 per cent/6 per cent. We value Nykaa using DCF, yielding a target of Rs 235 (earlier Rs 205) as we are increasing medium term growth and profitability; retain ‘BUY’," it said.

Elara Securities retained its 'Accumulate' call, raising targe to Rs 215.  BPC GMV growth stood healthy at 30.8 per cent YoY and despite competitive intensity, Nykaa outperformed the online BPC industry, it added.

"Growth in Fashion GMV is also scripting a come-back. We expect BPC/Fashion verticals to print revenue CAGR of 29.7 per cent/24. per cent% in FY25-28E. Losses in Fashion are likely hitting trough and recovery to be key monitorable" it as it values BPC at  45 times EV/Ebitda, and Fashion at 4 times price-to-sales.

While Fashion GMV growth gained momentum, margins disappointed due to marketing investments. We have now pushed Fashion segment breakeven to FY27, JM said.