Snapdeal narrows losses by 71 pc in FY19, reports 73 pc revenue growth
Snapdeal has announced its financial results for FY 2018-19, and the e-commerce company says it shows a strong all-round topline and bottom line performance.
As per regulatory documents filed by Snapdeal, its consolidated revenues grew to Rs 925.3 crore in 2018-19 as compared to Rs 535.9 in 2017-18, marking a sharp increase of nearly 73 percent in a 12-month period.
At the same time, Snapdeal also managed to significantly reduce its loss to Rs 186 crore in FY19 from Rs 611 crore reported in FY18, representing a drop of nearly 71 percent.
The revenue from operations saw a healthy YoY jump of 87 percent - from Rs 436.1 crore (FY18) to Rs 813.8 crores (FY19).
In its filings, the company shared, “This year, we continued our focus on driving growth with a lean and capital-efficient foundation in the business. Our operating revenue increased by 87 percent YoY basis with a significant reduction of the cost base."
Snapdeal claimed that it achieved a significant milestone by achieving cash break-even in the month of June 2018, and made the highest-ever net revenue in its history in October 2018.
In a blog posted on his LinkedIn account, Kunal Bahl, Snapdeal’s CEO and Co-founder said, “Our transacting customers grew 2.2X and traffic surged 2.3X to 70 million unique users/month. And all this in a year when ecommerce companies in India burnt through $2.5 billion in the pursuit of growth.”
Bahl added, “The doubling of our orders in the last one year is actually a two-fold increase in the business of the seller partners on our platform, the majority of whom are small businesses. Each and every order is fulfilled on Snapdeal is by independent, third-party seller partners”.
While Snapdeal was once counted as one of the top three ecommerce companies in India, it began to lose ground to Amazon and Flipkart after a period of time. According to media reports, the market share of the company fell to four percent in 2017 from about 24-25 percent in 2015.
There was even a point where Snapdeal was reportedly just at an inch away from merging with Flipkart to sustain itself. But in July 2017, the company quashed speculations and came up with Snapdeal 2.0 and said that it will sell its non-core assets, and will bring financial self-sustainability.
As part of the journey, it first sold off its payment arm Freecharge in 2017 to Axis Bank for $60 million (Rs 385 crores) in cash. And then in 2018, it sold its logistics arm Vulcan Express to Future Group’s supply chain solutions subsidiary for Rs 35 crore.
In FY17, Snapdeal’s consolidated losses were Rs 4,638 crore, which dropped 87 percent to Rs 611 crore in FY18 and then further another 71 percent to Rs 186 crore in F19.
In the last two years, Snapdeal has added more than 60,000 new seller partners, who have added over 50 million new listings. It claims to have more than 500,000 registered sellers, who have more than 200 million listings on the marketplace.
(Edited by Saheli Sen Gupta)