FirstCry, the Mumbai-based omnichannel baby and kids marketplace, experienced a substantial setback in the financial year ending March 31, 2023, as its consolidated net loss surged by over 500%. The startup reported a consolidated net loss of INR 486 Cr in FY23, marking a staggering 518% increase from INR 78.6 Cr in the previous fiscal year. It’s noteworthy that FirstCry had achieved a net profit of INR 215.9 Cr in FY21, signaling a remarkable shift in its financial trajectory.
Sales Milestone and Revenue Growth
Despite the challenging financials, FirstCry achieved a significant sales milestone, crossing the INR 5,000 Cr mark during the fiscal year under review. The operating revenue witnessed a substantial rise of 135%, reaching INR 5,632.5 Cr in FY23 compared to INR 2,401.2 Cr in the previous fiscal year. The primary source of revenue for FirstCry remains the sale of baby care products.
Expenditure Breakdown
FirstCry’s total expenditure in FY23 amounted to INR 6,315.6 Cr, indicating a substantial increase of 146% from INR 2,568 Cr in FY22. A breakdown of key expenditure areas reveals the following:
- Procurement Cost: The startup spent INR 3,953.3 Cr for restocking its shelves, witnessing a significant 150% increase from INR 1,572.1 Cr in FY22.
- Employee Benefit Expenses: FirstCry allocated INR 769.8 Cr for staff salaries, gratuity, PF, and other benefits, marking a notable 127% increase from the previous year. Notably, ESOP expenses increased by 292% to INR 361.4 Cr from INR 92.1 Cr in FY22.
- Transportation Cost: A substantial rise in transportation costs was observed, with FirstCry spending INR 429.2 Cr, reflecting a 604% increase from INR 61 Cr in the previous fiscal year.
- Advertising Expenses: Advertising costs experienced a 55% surge, reaching INR 416.4 Cr in FY23, up from INR 268.6 Cr in FY22.
Financial Outlook and IPO Plans
Despite the surge in sales, FirstCry’s EBITDA margin deteriorated to -2.9% from 4.05% in FY22. The startup, led by Supam Maheshwari, is poised to file its draft red herring prospectus (DRHP) for its IPO by the end of the month. Reports suggest that FirstCry aims to raise $500 Mn-$600 Mn at a valuation of $4 Bn.
The startup, backed by prominent investors such as SoftBank, Chrys Capital, and Vertex Ventures, has raised over $700 Mn in multiple funding rounds. A recent secondary round involved family investment offices, including Manipal Group’s MEMG Family Office, Marico’s Sharrp Ventures, and DSP family office, collectively investing INR 435 Cr in FirstCry.
