IPO-bound Wakefit inches towards profitability, narrows FY24 losses
The omnichannel retailer, which filed its draft red herring prospectus (DRHP) with SEBI, recorded a 21.9% rise in FY24 revenue to Rs 986.25 crore.
Wakefit, the omnichannel retailer of mattresses and furniture, significantly narrowed its losses in the fiscal year ended March 31, 2024. The company reported a loss of Rs 15.05 crore during this period, down from Rs 145.68 crore in FY23, a reduction of approximately 9.7 times, signalling a strong push toward profitability ahead of its planned IPO.
Additionally, the company reported a 21.9% rise in annual revenue, reaching Rs 986.35 crore compared to Rs 812.6 crore in the year-ago period, driven by rising sales across its product categories—mattresses, furniture, and furnishings.
Despite the uptick in revenue and narrow losses, the Peak XV-backed company saw a 6.91% rise in expenses during the period, primarily due to an increase in employee benefits expenses, other expenses, and finance costs.
The company attributed its losses in FY24, FY23, and FY22 to rising expenses related to expansion of its manufacturing facilities, warehouse infrastructure, and store network.
During the nine-months ended December 31, 2024, the company reported Rs 971.08 crore in revenue from operations and a loss of Rs 8.81 crore.
Going forward, the company is banking on the strategic expansion of its store network as well as the setting up of its first “Jumbo” store to drive demand and growth.
Additionally, auditors flagged minor delays in paying equalisation levy—a direct tax, which is withheld at the time of payment by the service recipient—and provident fund dues. It noted that Wakefit had been irregular in paying professional tax, with delays lasting up to 12 months for a total amount $870,000.
The auditors also noted that the company did not have an internal audit system put in place during the time of audit and flagged that while it had incurred any cash losses in the current financial year, it had incurred losses of Rs 46.2 crore in the immediately preceding financial year.
The Bengaluru-based company was founded in 2016 by Ankit Garg and Chaitanya Ramalingegowda. It filed its draft red herring prospectus with markets regulator SEBI on Friday.
According to the DRHP, the offer comprises a fresh issue of shares worth Rs 468.2 crore and an offer for sale of up to 5.8 crore of equity shares.
Wakefit intends to use majority of the funds raised to set up 118 new company-owned and operated stores across the country.
Edited by Megha Reddy