ElasticRun surpasses Rs 3,800 Cr in revenue in FY22 thanks to improved economics
- ByStartupStory | November 15, 2022
ElasticRun, a Kirana e-commerce platform, joined the coveted unicorn club at the end of the previous fiscal year after receiving $300 million from Softbank. The company’s valuation increased significantly to over $1 billion in February as a result of a quick ramp-up throughout FY22.
ElasticRun’s annual financial statement filed with the Registrar of Companies shows that its scale increased 3.5X to Rs 3,813 crore in FY22.
The B2B e-commerce platform combines supply from more than 400 FMCG brands and offers rural stores in more than 80,000 villages across 26 Indian states logistics and warehousing services. 91.5 percent of the operating revenue, which increased 4.1 times to Rs 3,487 crore in FY22, came from the wholesale trade of goods.The remainder was generated through logistics and distribution services, which saw a 36.4% increase to Rs 326 crore during the most recent fiscal year. Additionally, the business earned Rs. 12.26 crore in income from fixed deposits.
On the expense front, ElasticRun’s largest cost center—which accounted for 82% of total costs—was the purchase of FMCG products. In FY22, this expense increased 4.2X to Rs 3,431 crore. 10% of total expenses went toward logistics and distribution, which saw a 74.5% increase to Rs 417 crore. In the meantime, ElasticRun’s payroll costs increased 2.6X to Rs 202 crore. ElasticRun’s overall expenses increased by 3.5X, and as a result, its losses increased by 3.7X to reach Rs 373 crore in FY22. The ROCE and EBITDA margins increased to -14.52% and -9.44% in FY22, respectively.ElasticRun spent Rs 1.10 to make one rupee in FY22 on a per-unit basis. High volumes typically make up for the narrow profit margins of the kirana commerce industry, which explains ElasticRun’s strong growth and promising future. In contrast, cost management will be just as important to the success of the company as volume expansion and the introduction of higher margin business segments. As rural incomes rise, the FMCG category is increasingly offering more of these opportunities, and in terms of rural areas, possibly bigger opportunities in higher margin segments.Due to its huge spread and intrinsic link to overall growth rates, ElasticRun will be counting on strong rural growth for the nation as a whole to support a great run.
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