India's Nykaa posts 24% jump in Q1 revenue on boost from summer sale

BENGALURU (Reuters) - India's Nykaa reported a higher first-quarter revenue on Friday, as the cosmetics-to-fashion retailer's flagship sale event helped sustain demand amid a slowdown in discretionary spending.

The company's revenue grew 23.8% year-on-year to 14.22 billion rupees (about $172 million) in the April-June quarter.

Nykaa's flagship 'Pink Summer Sale' helped boost its beauty and personal care (BPC) segment - the company's biggest. BPC orders increased by 17% in the quarter.

The company's overall gross merchandise value (GMV) - the monetary value of all its orders - rose 24% to 26.68 billion rupees.

The BPC business's GMV grew by the same margin, accounting for nearly 70% of total GMV and helping outweigh a relatively smaller 12% rise in the fashion segment's GMV, which, Nykaa said was slower than the segment's long-term trajectory.

Nykaa had warned last month that apparel sales were hit by lower discretionary spending, especially in smaller cities and towns.

While India's retail inflation eased in April and May before rising slightly in June, it has remained stubbornly high enough for consumers to think twice about certain discretionary spends.

In this environment, Nykaa has also had to contend with a raft of executive resignations, including its marketing head, a move that led to founder and CEO Falguni Nayar taking direct oversight of the function.

Nykaa's consolidated profit before tax rose 16.5% year-on-year to 97.2 million rupees. Its profit attributable to shareholders, however, fell 27.4% to 33 million rupees, while profit for non-controlling interests surged 4.6-fold. ($1 = 82.8050 Indian rupees)

(Reporting by Varun Vyas in Bengaluru; Editing by Savio D'Souza)