The recent top-level exits at Nykaa were because the company was upgrading its talent pool and it reevaluated the role of executives as some of the employees who left were not doing any significant work, Falguni Nayar, executive chairperson, MD, and CEO of the e-commerce company told analysts after the reporting its Q1Fy24 results on August 11.
Nayar’s comments come at a time when Nykaa has seen a slew of top-level exits. Since April, six senior executives, including its chief marketing officer, Shalini Raghavan, among others have quit the company.
The six exits came after five senior executives, including Nykaa SuperStore CEO Vikas Gupta, Chief Business Officer Gopal Asthana and Chief Commercial Officer Manoj Gandhi resigned from the company in March.
“There is a clear upgradation of talent going on. There are people in that group (of people who left Nykaa) who were not doing any significant roles,” Nayar told an analyst.
“Nykaa has a tight evaluation process where we have decided to differentiate between high performers, average performers and performers which are below the threshold… there was no significant erosion of talent. Talent is better now than ever,” she added.
After Raghavan, the marketing lead quit, and Nayar took over as Nykaa’s CMO, Moneycontrol had reported earlier.
With deep pockets, large traditional players have been able to attract talent from companies like Nykaa, which has impacted their growth trajectory. While Reliance is setting up Tira to take on new-age players in the BPC space, Tata is ramping up its e-commerce offerings under Tata Cliq and is roping in experienced people to lead its efforts.
Asthana jumped to Tata Cliq to lead the e-commerce platform months after departing from the Falguni Nayar-led company, which is facing competition from Reliance, Tata and several other players. Gupta, on the other hand, had joined VLCC as CEO.
To keep the business going, Nykaa had made new appointments but did not shed light on why the senior management was quitting in large numbers.
"As Nykaa evolves into a multi-dimensional, multi-geographic business, leadership roles are being augmented with an eye on strategic realignment, cost rationalization and growing complexity of the business," Nykaa had said in its statement to Moneycontrol.
In line with those plans, the company said it had elevated Shailendra Singh as Business Head for Physical Retail- Beauty and will continue to lead omnichannel initiatives. Singh joined Nykaa around 18 months ago from FMCG giant HUL. The company also said Rozita Nouruzi is now the CEO of Nysaa, its omnichannel beauty business and will lead operations in the GCC region.
During the call, Anchit Nayar, executive director and chief executive, Nykaa Beauty, added that the company is now getting higher quality of talent coming into key roles.
“We have revamped and really focused on our appraisal process and the way we are deciding on what roles are critical and which are not... The focus has just been on ensuring we have the right people in the right seats,” he added.
The analyst call happened after Nykaa reported that its profits in Q1FY24 fell about 27 percent on a year-on-year (YoY) basis to Rs 3.3 crore.
In the same quarter last year, the company reported a profit of Rs 4.6 crore. In both cases, equity shareholders of the parent was considered.
At the company-level, FSN E-Commerce Ventures had reported a net profit of Rs 5.4 crore in Q1FY24, which was about 8 percent higher than Rs 5 crore in Q1FY23.
Meanwhile, the company's revenue from operations stood at Rs 1,421.8 crore in Q1FY24, which is an increase of around 24 percent from Rs 1,148.4 crore that it registered in the same quarter last year.
(Disclosure: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary)
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
