In order to market beauty items in the Gulf region, Indian cosmetics-to-fashion shop Nykaa has partnered with Dubai-based fashion and leisure retailer Apparel Group.
To take advantage of the market opportunity and growth potential in the region, the two partners will join forces to create a new company that will market and sell these items in six countries that make up the Gulf Cooperation Council (GCC) region.
According to a regulatory filing by Nykaa, FSN International Pvt. Ltd., a unit of Nykaa, will own 55% of the new business, with Apparel Group owning the remaining 40%. The partnership's finances were kept private. Nykaa aspires to establish a multi-brand beauty retailing enterprise in Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.
This would be Nykaa's entry into the global market, a move that would probably aid the Falguni Nayar-led business in somewhat isolating its operations from India, where it is based. Currently, Noon.com is where the company distributes some of its items in the UAE.
Sima Ved founded the Apparel Group in 1996. Through a network of more than 2,000 retail locations, the company sells more than 75 brands, including Charles & Keith, Skechers, Aldo, Nine West, Aeropostale, Jamie's Italian, Tim Hortons, Cold Stone Creamery, Inglot, and Rituals, in 14 different countries.
According to Nykaa, the partnership "will assist Nykaa in utilising the Apparel Group's strong offline retail network and extensive market ties to produce distinctive GCC-focused beauty goods."
According to Falguni Nayar, CEO of Nykaa, the new digital platform is anticipated to launch over the next six months.
“This alliance is going to be a new chapter in our expansion journey as we look forward to leveraging each other’s strengths and offer unique value proposition to our consumers in the GCC region," said Ved, founder and chairperson, Apparel Group, in the statement.
According to a Red Seer report cited by Nykaa, the beauty and personal care markets in Saudi Arabia and the UAE, two of the largest in the region, were valued at $17.1 billion and $6.6 billion, respectively, in 2021. These markets are expected to grow at a CAGR of 7% and 9%, respectively, over the following three years.
