Melorra’s scale surge 4.6X in FY22, losses exceed Rs 100 Cr

• ByStartupStory     |    October 19, 2022

Direct-to-consumer (D2C) gold jewellery brand Melorra has developed at a blistering speed in fiscal year (FY22), despite encountering pandemic-related setbacks in the previous fiscal year (FY21). The Mumbai-based business increased its operational revenue by 4.6X during the previous fiscal year (FY22).

In FY22, Mellora’s operational revenue increased to Rs 364.4 crore from Rs 78.6 crore in FY21, according to its annual financial statement submitted to the Registrar of Companies (RoC).

Melorra sells lightweight, stylish jewellery for regular or everyday wear that is centred on gold, diamonds, and gemstones. Rings, earrings, pendants, chains, solitaires, and other items are included in its product line. In FY22, the company’s sole source of income is the sales of these products.

Looking at the expense sheet, Melorra’s greatest cost centre, materials, accounted for about 62% of its overall spending. This cost increased 4.6X to Rs 291.5 crore in FY22 from Rs 63 crore in FY21, keeping up with top-line growth.

To increase scale, Mellora has aggressively invested in marketing and promotion. At the beginning of FY22, it also appointed Bollywood star Shraddha Kapoor as its brand ambassador. The previous fiscal year saw a 2.7X increase in these costs, reaching Rs 120.3 crore.

Employee benefit costs and IT costs (including gateway fees) for the company increased by 56% and 239.6% to Rs 30.1 crore and Rs 9 crore in FY22, respectively. The total expenditures increased by 3.3X to Rs 471.3 crore as it also had to pay Rs 4.1 crore in legal and professional fees.

Mellora’s losses rose 73.5% to Rs 106.7 crore in FY22 as a result of a substantial increase in its expenses. The increase in losses had an effect on the company’s financial outflows as well, which increased by 84% and reached Rs 138.2 crore during that time.

Melorra spent Rs 1.29 in order to make one rupee in FY22. If the company maintains its speed, it may reach profitability as early as FY23, if not FY24, thanks to the high growth rate and the moderated growth rate for losses.

Melorra is in direct competition with BlueStone, which is funded by Ratan Tata and valued at $410 million. BlueStone raised $30 million in a funding round that was led by Hero Enterprise. Bluestone reported operational losses of Rs 13.7 crore and revenue of Rs 269 crore in FY21. In a $10 million Series A financing sponsored by Sixth Sense Ventures, GIVA generated operational revenue of Rs 21.53 crore in FY21. The largest participant in the market, Caratlane, which is funded by Tiger Global and has raised $58 million over four rounds since its founding, finished Q1 FY23 with Rs 483 crore in revenue and Rs 34 crore in EBITDA.

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