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Coaching chain Motion scale remains flat at Rs 108 Cr in FY25

EntrackrEntrackr · 11d ago
Coaching chain Motion scale remains flat at Rs 108 Cr in FY25
Medial

The content relevant to the URL is: Coaching chain Motion scale remains flat at Rs 108 Cr in FY25 IIT-JEE and NEET-focused bootstrapped coaching institute chain Motion reported no growth in the fiscal year ending March 2025. However, the Kota-based firm recorded a slight decline in profit in the same period. Motion’s revenue from operations stood at Rs 108 crore in FY25, marginally declining from Rs 109 crore in FY24, according to its financial statement sourced from the Registrar of Companies (RoC). Founded in 2007, Motion offers coaching programs for competitive examinations such as JEE and NEET through classroom training at its offline centres as well as online learning solutions. The firm generates revenue from course fees paid by students enrolled in its programs. The firm added around Rs 2 crore from non-operating income, which kept its total income steady at Rs 110 crore in FY25. Employee benefit expenses accounted for the largest share of the company’s spending. This cost increased 4% to Rs 49 crore in FY25 and formed nearly 48% of the total expenditure. Advertising and promotional expenses declined 8% to Rs 12 crore in the last fiscal year. Legal charges grew 33% year-on-year to Rs 10 crore during FY25, while rent expenses also rose 17% to Rs 5.2 crore. Overall, the firm’s total expense increased marginally to Rs 103 crore in FY25 from Rs 102 crore in FY24. Despite stable income, Motion’s profit declined 6.7% to Rs 5.6 crore in FY25 from Rs 6 crore in the previous fiscal year. Its ROCE and EBITDA margin improved to 12.29% and 10.74%, respectively. On a unit basis, the company spent Rs 0.95 to earn a rupee of operating revenue during the fiscal year. Motion reported total assets of Rs 115 crore in FY25, up from Rs 81 crore in FY24. It recorded cash and bank balances of Rs 10 crore, while its current assets stood at Rs 23 crore at the end of FY25. The Kota-based company has not raised any funding yet and competes with the likes of Aakash, Career Point, Allen and Resonance. Allen reported Rs 3,067 crore in FY25, while its profit plummeted 70% to Rs 41 crore. On the other hand, Aakash recorded a loss of Rs 2,443 crore in FY24, which was primarily attributed to exceptional items connected to its parent company, Byju's. During the same fiscal year, Aakash's revenue from operations remained stable at Rs 2,438 crore. The company has not yet submitted its financial reports for FY25. Motion’s flat performance in FY25 also reflected the broader trend in the coaching segment. Larger players such as Allen and Aakash also reported limited growth during the period. While Allen’s profit dropped sharply despite large revenue, Aakash’s scale is expected to remain largely unchanged in FY25. Against this backdrop, Motion’s steady revenue indicates a stable but slow-moving phase for traditional coaching institutes amid rising competition and shifting student preferences.

Allen nears Rs 3,500 Cr revenue in FY24, profit shrinks 44%

EntrackrEntrackr · 1y ago
Allen nears Rs 3,500 Cr revenue in FY24, profit shrinks 44%
Medial

Offline coaching institutes have been finding it tough to scale their profits, and Allen Career Institute is no exception. The Bodhi Tree-funded firm reported a 44% year-on-year decline in profit for the fiscal year ending March 2024. In the second half of this story, we’ll delve into the expense patterns that led to this decline. For now, let’s focus on its revenue and sources. Allen’s revenue from operations increased 42% to Rs 3,244.7 crore in FY24, as compared to Rs 2280.8 crore in the previous fiscal year, its financial statement filed with the Registrar of Companies shows. This growth was driven by a 42.2% increase in service income, reaching Rs 3,215 crore, which accounted for 99% of the revenue, and a 51% rise in product sales to Rs 8 crore. Income from product sales vertical grew by 51.4% year-on-year in the last fiscal year. With a 98.9% increase in interest income, the company’s total revenue reached Rs 3,473.2 crore in the last fiscal year. Employee benefit costs were the largest expense for the company, rising 68% to Rs 1958 crore in FY24. The cost of materials increased by 74.2% to Rs 123.5 crore. However, its marketing expenses spiked by 2.3X to Rs 117.9 crore. Overall, the company’s total expense surged 63% to Rs 3252 crore in FY24 from Rs 1993 crore in FY23. Due to higher spending and relatively lower revenue growth, the company’s profit declined by 44%, falling to Rs 135.9 crore in FY24 from Rs 243.7 crore in FY23. While its EBITDA remained stable at Rs 629.8 crore, margins declined to 18.13% in the last fiscal year. Further, the firm’s ROCE declined to 9.26% from 14.7% in FY23. On a unit basis, Allen spent Re 1 to earn a rupee of operating revenue in the fiscal year ending March 2024. Allen's financial position remained stable, with total assets rising by 10.8% to Rs 5,759 crore and cash and bank balances improving by 19.8% to Rs 1,958 crore. Current assets also grew by 8.2% to Rs 2,795 crore, while capital employed expanded by 15.9% to Rs 3,630 crore. While Allen maintained revenue growth and a stable financial position, the significant rise in costs and a drop in margins underline the challenges of scaling in the offline coaching industry. The decline in profitability signals a need for further optimization as the company navigates an evolving education sector landscape. Allen Career Institute is reportedly in early discussions to acquire Unacademy amid a 31% year-on-year decline in admissions to Kota-based institutes in 2024. The waning popularity of the city-based coaching culture is set to impact the top and bottom lines of Allen, and FIITJEE(FY25). However, they remain better positioned compared to their online counterparts, Byju's and Unacademy. FIITJEE, Allen's closest competitor, operates at approximately one-fourth of Allen's scale. While FIITJEE has yet to disclose its FY24 financials, it reported a 21% year-on-year revenue growth to Rs 542 crore in FY23. In the same fiscal year, Allen's income stood at Rs 2,277 crore. Another competitor, Aakash, which was acquired by BYJU'S, anticipated crossing the Rs 3,000 crore revenue mark in FY23. However, its audited financials for FY23 and FY24 are yet to be released. Allen’s PE deal in some ways marked the peak of the edtech boom, as the last of the large firms that had held out until then before taking the plunge. It is showing signs of the same, with pressure to spend their way to some sort of leadership, even at the cost of margins that the firm always had before the funding. The Unacademy deal, if it works out, will be yet another investor-backed deal no doubt, to beef up the balance sheet size. Will that really be the solution the firm is looking for to combat future risks? One has to wonder, considering just how fast the market is evolving, and the challenges of integrating such a firm within the Allen culture.

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