Nykaa Boosts Earth Rhythm Stake in Clean Beauty Push

Nykaa, the prominent Indian beauty and fashion retailer, has significantly bolstered its ownership in Earth Rhythm, a fast-growing clean beauty brand. The company recently finalized the acquisition of an additional 24.2% stake, a move valued at up to Rs 9.4 crore. This latest transaction, finalized in September 2026 following board approval on May 21, 2026, underscores Nykaa's strategic commitment to expanding its portfolio of owned brands within the rapidly expanding sustainable personal care market.

The acquisition represents a further consolidation of Nykaa's influence over Earth Rhythm, which specializes in certified organic and plant-based formulations. Founded in 2019, Earth Rhythm boasts an extensive product range exceeding 250 stock-keeping units (SKUs) across six categories. Its popular offerings, including lip and cheek tints, shampoo bars, and sun protection products, are notable for their commitment to sustainability, with 99% of their packaging being plastic-free. This aligns perfectly with a discernible shift in consumer preference towards eco-conscious beauty solutions, a trend that has seen significant acceleration in the Indian market.

This latest investment builds upon Nykaa's prior engagement with Earth Rhythm. The e-commerce giant initially secured a minority interest in the clean beauty player in 2022 through a combination of primary and secondary investments. Subsequently, in August 2024, Nykaa announced a substantial capital infusion of up to Rs 44.5 crore, which effectively established Earth Rhythm as a majority-owned subsidiary. The current acquisition of a larger stake further solidifies this control and Nykaa's strategic direction.

Adwaita Nayar, a key executive at Nykaa, highlighted the synergistic potential of this deepened partnership. She indicated that Nykaa intends to leverage its extensive capabilities in innovation, marketing strategies, and its robust omnichannel distribution network to propel Earth Rhythm's growth. Crucially, this expansion will be managed while preserving the distinct brand ethos of Earth Rhythm. Harini Sivakumar, the founder and CEO of Earth Rhythm, echoed this sentiment, emphasizing the invaluable contribution of Nykaa's expansive distribution infrastructure and its comprehensive marketing approach, which spans social media engagement, influencer collaborations, and content creation.

The Indian beauty and personal care market is experiencing robust growth, with the clean beauty segment showing particularly strong momentum. Industry reports suggest the market is projected to grow at a significant compound annual growth rate (CAGR) over the next five years, driven by increasing consumer awareness regarding ingredient transparency and environmental impact. Nykaa's strategic move to increase its stake in Earth Rhythm positions it favorably to capitalize on this expanding market opportunity.

This strategic alignment is expected to unlock significant operational efficiencies for Earth Rhythm. By integrating with Nykaa's established retail channels, which encompass both physical stores and digital platforms, the brand can achieve greater scale. Furthermore, Nykaa's proven expertise in brand building and customer engagement will provide Earth Rhythm with a distinct competitive advantage. This move is consistent with Nykaa's broader strategy to cultivate and acquire brands that cater to evolving consumer demands, particularly in high-potential segments like clean beauty.

Nykaa's own financial performance provides a strong backdrop for such strategic investments. In the second quarter of fiscal year 2025, ending September 30, 2024, the company reported a net profit of Rs 13 crore, marking a substantial 67% year-over-year increase. Revenue reached Rs 1,875 crore, up 24% YoY, with EBITDA growing 29% YoY to Rs 103.7 crore. These strong results demonstrate Nykaa's operational strength and its capacity to pursue strategic acquisitions that promise long-term value creation.