Udaan’s net loss little changed as revenue more than sixfold

Business-to-business (B2B) marketplace based in Bangalore Udaan, owned and operated by Trustroot Internet Pvt. Ltd., managed to narrow its net loss for 2020-21 (FY21) slightly even though the company’s revenue grew more than six times over the same period.

Trustroot Internet recorded a net loss of 2,482 crore for FY21 against a net loss of 2,519 crore, the documents filed by the company with the Ministry of Commerce, Government of Singapore (Bizfile) from VCCircle show. Trustroot Internet is the parent company of Udaan and is registered in Singapore. Udaan’s spokesperson declined to comment on the story.

During the period, the Company’s consolidated operating revenues increased to 5,919 crore against Rs 978 crore a year earlier. The company’s total spend more than doubled to Rs 8,742 crore from 3,675 crore in 2019-20 (FY20).

In April 2020, Udaan reportedly laid off many contract workers in an effort to save capital in anticipation of a drop in demand, after the central government announced a lockdown to curb the spread of the contagious Covid-19 (Udaan lays off more than 2 000 contract workers as covid-19 hits supply chains). However, e-commerce penetration in India accelerated in 2020 after local and state authorities imposed restrictions on businesses and people’s movement, forcing millions of people to switch to online shopping.

As a result, many e-commerce businesses have seen their sales increase. Myntra Designs Pvt Ltd, which operates a beauty and lifestyle e-commerce marketplace, saw a 44% increase in revenue, VCCircle reported on Tuesday. Myntra’s parent company, Walmart-owned Flipkart, also reported a more than 25% increase in FY21 sales. Udaan’s exponential revenue growth further argues for increased demand for online shopping.

The company has long been touted as the fastest Indian company to achieve unicorn status. Unicorns are private companies with a valuation of over $1 billion. The company had gone unicorn in 2018 when it raised $225 million in its Series C funding round from DST Global and Lightspeed Venture Partners.

The Bengaluru-based company recently raised a round of $250 million (approx. 1,875 crore) via convertible note and debt, according to regulatory filings. Previously, in January last year, the company raised $280 million from US technology investment firm Octahedron Capital and Moonstone Capital, who joined as new investors, alongside existing investors Lightspeed Venture. Partners, DST Global, GGV Capital, Altimeter Capital and Tencent, which also participated in the funding round.

Udaan, founded in 2016 by former Flipkart employees Amod Malviya, Sujeet Kumar and Vaibhav Gupta, connects merchants, wholesalers, retailers and manufacturers on a single platform, and enables them to discover customers, suppliers and products in all categories. The platform also helps traders connect directly with each other for the best deal.

Co-founder Malaviya previously said the coronavirus pandemic had accelerated the already rapid, digitally-led evolution of India’s highly fragmented and unorganized commerce and retail industry.

To subscribe to Mint Bulletins

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now!!

Ann J. Cox