Swiggy’s FY24 loss saw a significant reduction, with the company’s net loss narrowing by 44% to INR 2,350 crore, down from INR 4,179 crore in FY23. This improvement in financial performance was accompanied by a notable 36% increase in revenue, which surged to INR 11,247 crore from INR 8,265 crore in the previous fiscal year. The reduction in Swiggy’s FY24 loss highlights the company’s effective cost management strategies and growth in its revenue streams.
Reduction in Swiggy’s FY24 Loss Through Strategic Cost Management
A key factor contributing to the reduction in Swiggy’s FY24 loss was a strategic decrease in promotional and marketing expenditures. The company successfully cut its marketing costs to INR 1,851 crore in FY24 from INR 2,501 crore in FY23. This reduction in advertising expenses played a crucial role in narrowing the loss figures for the fiscal year. Despite the lower spending on promotions, Swiggy’s total expenditures rose by a modest 8% to INR 13,947 crore in FY24, compared to INR 12,884 crore in the previous fiscal year.
The company’s gross order value (GOV) also saw a substantial increase, reaching $4.2 billion, which represents a 26% year-on-year growth. Swiggy’s food delivery segment was the largest contributor, accounting for $3 billion of the total GOV. Additionally, Instamart and Dineout contributed $1 billion and $300 million, respectively. The average order value (AOV) for Swiggy’s food delivery services stood at INR 428, reflecting a strong performance in the food delivery segment.
Swiggy’s management attributed the reduction in FY24 loss to a strategic shift in investment focus. The company scaled back its investments in Instamart, which helped improve overall profitability. The more mature food delivery business continued to grow profitably, which further aided in reducing the overall loss.
Swiggy’s IPO Plans and Market Valuation
As Swiggy prepares for its initial public offering (IPO), it filed its draft IPO papers confidentially with the Securities and Exchange Board of India (SEBI) earlier this year. The company is targeting a valuation between $15 billion and $15.2 billion for its upcoming IPO. This valuation represents a significant increase from the previous valuation of $11.5 billion, as estimated by investor 360 One last week.
Founded in 2014 by Sriharsha Majety, Nandan Reddy, Phani Kishan Addepalli, and Rahul Jaimini, Swiggy initially started as a food delivery startup. Over the years, the company has diversified its offerings, expanding into the quick commerce sector with Instamart and introducing additional services such as Swiggy Genie and Minis stores.
The company’s growth trajectory and strategic decisions, including the reduction in promotional costs and focus on profitable business segments, have positioned Swiggy as a strong contender in the market. With its upcoming IPO, Swiggy aims to leverage its improved financial metrics and market valuation to attract investors and secure a successful listing.
In comparison to Swiggy, Zomato also reported strong financial performance for FY24. Zomato’s operating revenue reached INR 12,114 crore, marking a 67% increase from INR 7,079 crore in FY23. The company achieved profitability with a net profit of INR 351 crore, a significant turnaround from a loss of INR 971 crore in the previous fiscal year.
Overall, Swiggy’s FY24 financial results demonstrate its effective cost management and revenue growth strategies. The reduction in Swiggy’s FY24 loss, coupled with its robust revenue performance and strategic investment shifts, highlights the company’s evolving financial health and market potential as it prepares for its IPO.
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