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Purplle hits Rs 700 Cr revenue in FY24, trims losses by 46%

Entrackr · 3m

The online beauty and grooming platform Purplle secured $120 million in funding, led by the Abu Dhabi Investment Authority (ADIA), in July this year. This significant investment came on the back of a 43% year-on-year spike in its revenue in the fiscal year ending March 2024. Besides sizable growth, the Mumbai-based firm also reduced its losses by 46% during the same period. While we will explore Purplle’s expense patterns later in the story, let’s first focus on its revenue channels and their growth in the last fiscal year (FY24). Purplle’s revenue from operations increased to Rs 680 crore in FY24 from Rs 475 crore in FY23, its consolidated financial statements sourced from the Registrar of Companies (RoC) show. The Manish Taneja-led company operates with two models: a marketplace and its own line of brands, such as Faces Canada and Good Vibes. Revenue from advertisement and visibility services was the primary source of income for Purplle, followed by sales of its own labels, royalties (from sellers), subscriptions, and support services. The Goldman Sachs-backed firm also earned Rs 45 crore from interest on investments, bringing its total income to Rs 725 crore in the last fiscal year (FY24), up from Rs 509 crore in FY23. For a detailed revenue breakdown, visit TheKredible. On the cost front, advertising and business promotion accounted for 25% of total expenses. This expense, however, decreased to Rs 209 crore in FY24 from Rs 266 crore in FY23. The company also grew its workforce during FY24, resulting in a 12% increase in employee benefit expenses. Purplle’s spending on materials, rent, information technology, legal services, secondary packaging, transportation, and other miscellaneous overheads pushed its total expenditure to Rs 850 crore in FY24, rising from Rs 738 crore in FY23. See TheKredible for the complete expense breakup. The 43% surge in scale and controlled expenditure, particularly in advertising, helped Purplle to cut its losses by 46% to Rs 124 crore in FY24 as compared to Rs 230 crore in FY23. Its ROCE and EBITDA margin also improved to -9.8% and -12%, respectively. On a unit level, the firm spent Rs 1.25 to earn a rupee in FY24. FY23-FY24 FY23 FY24 EBITDA Margin -39% -12% Expense/₹ of Op Revenue ₹1.55 ₹1.25 ROCE -18% -9.8% As of March 2024, Purplle had cash and bank balances of Rs 109 crore. According to Entrackr’s back-of-the-envelope estimates, its enterprise value to revenue multiple stood at 15.8 times. A large recent funding round, strong growth momentum, and improving margins. Purplle would seem to have everything going for it. However, it has to contend with similar firms that have actually gone public as well, like Nykaa and Mamaearth, ensuring that competitive intensity remain strong in the sector. It is also increasingly clear that owning strong, profitable brands is the key to success, and on this front, Purplle seems to have got it right with its own brands performing well. That would indicate every chance of growth sustaining, and margins improving further in Fy25. Who knows, perhaps even an IPO in FY26?