Swiggy’s parent company Bundl Technologies has experienced its revenue drop, posting net operating revenue of Rs 2,547 crore for the fiscal year ended March 31, 2021, down from Rs 3,468 crore in FY20. The total income amounted to Rs 2,675 crore. According to a regulatory filing accessed by Tofler, the key reason for the decrease in growth was lockdown and restrictions on delivery services.
During the same fiscal year, the recently turned decacorn posted a net loss of Rs 1,314 crore. This resulted in a drop of 65 percent from the previous fiscal year. Furthermore, the overall expenses of the company totaled Rs 3,310 crore. One of the key expenses was the company’s overall employee benefits expense of Rs 935 crore. The company, on the other hand, reported a 10 percent salary hike and a 30 percent attrition rate.
The Bangalore based online food ordering and delivery platform in the filing said, “Our business has shown strong recovery through the year and has grown by 1.2x from March 2020 level and 2.2x from June 2020 levels with a strong focus on Customer Acquisition and Retention; Supply Improvements (both Restaurants and Delivery Riders) and a high bar on Experience with focussed interventions on improving Selection, Price and Convenience, and Policies for our customers as well as partners.”
The Central Government enforced a statewide lockdown to combat the spread of Covid-19 during the fiscal year under review. This, along with the general concern of spreading the virus, resulted in a dramatic decrease in demand for food delivery.
The company reported a strong recovery, growing 1.2x from March 2020 thresholds and 2.2x from June 2020 rates, with a heavy focus on customer acquisition and retention; supply developments (both restaurants and delivery riders); and a high bar on experience with targeted interventions on strengthening selection, price, and convenience, along with policies for its customers and partners.
Swiggy generates the majority of its revenue from service income, in which it charges a commission fee to partner restaurants when an order is made through its platform and is executed. Service income declined drastically to Rs 1,562 crore from Rs 2,352 crore the previous year. The company also generates income from deliveries in addition to service fees, and its delivery income dropped by nearly 75 percent last year. On top of its food discovery recommendations, the company generates revenue by charging fees to restaurants to advertise the restaurants, and its income from this channel plunged 19 percent.
Swiggy secured $700 million in funding earlier this month at a valuation of $10.7 billion, more than doubling its valuation within six months. The startup is increasing its involvement in the larger ecosystem. Swiggy now has enough cash to compete with Zomato, Dunzo, Licious, Amazon, Flipkart, and Ola Foods.