SUMMARY
- Zappfresh reported a 70% YoY increase in its net profit, reaching approximately Rs 4.7 crore in FY24.
- The Delhi NCR-based company had posted net profit of Rs 2.7 crore in FY23 from its net loss of Rs 2.5 crore in FY22.
- Operating revenue for Zappfresh surged by over 60% to Rs 90.4 crore in FY24 from Rs 56.3 crore in FY23.
Online meat delivery startup Zappfresh has recently filed a draft red herring prospectus (DRHP) for an IPO on the BSE SME. In FY24, the company reported a 70% YoY increase in its net profit, reaching approximately Rs 4.7 crore.
The Delhi NCR-based company achieved profitability in FY23 with net profit of Rs 2.7 crore, marking a turnaround from its net loss of Rs 2.5 crore in FY22. Operating revenue for Zappfresh surged by over 60% to Rs 90.4 crore in FY24, from a revenue of Rs 56.3 crore in FY23.
Established in 2015 by Deepanshu Manchanda and Shruti Gochhwal, Zappfresh is a comprehensive business that offers online access to fresh meat and ready-to-cook/eat non-vegetarian products. The company’s operations span from procuring fresh produce to processing, storage, and delivery.
While Zappfresh’s revenue and profit margins have seen improvement in FY24, they fall short of the company’s initial projections. The company had previously forecast an overall revenue of Rs 300 crore by the end of FY24, with Bengaluru contributing Rs 70 crore to this figure.
According to the company’s draft red herring prospectus, Zappfresh’s total revenue from Karnataka in FY24 amounted to Rs 13.8 crore, with the company’s operations being limited to Delhi NCR and Bengaluru.
Delhi continues to be the primary contributor to Zappfresh’s revenue, accounting for 35.7% of its operating revenue. Following Delhi, Haryana contributes the second-highest share of revenue at 27.96%.
Zappfresh operates in three primary segments: chicken, mutton, and seafood. The chicken segment, in particular, experienced significant growth, contributing Rs 51.1 crore to its revenue in FY24 with a 61.7% YoY increase. The mutton segment saw a 50% YoY increase in revenue to Rs 18.5 crore.
The seafood segment witnessed the most substantial increase in revenue, with a growth of over 68% YoY to Rs 20.8 crore in FY24.
In terms of expenses, Zappfresh’s total expenditure increased by over 54% YoY to Rs 83 crore in FY24 from Rs 53.8 crore in FY23. The cost of materials emerged as the primary expense factor, with spending on materials consumed by the company increasing by over 66% to Rs 68.5 crore from Rs 41.2 crore in FY23.
The company also allocated a significant portion of its budget towards employee benefits, with total expenses in this category rising to Rs 1.4 crore in FY24 from approximately 99 lakh in FY23. Around Rs 1.1 crore, was allocated to salaries and wages.
In terms of advertising, Zappfresh increased its expenditure on advertisements by over 60% to Rs 5.1 crore in the year under review, compared to Rs 3.2 crore in FY23.
Additionally, the company spent Rs 3.8 crore on outsourcing services, marking a significant increase of 46.6% YoY.
Overall, Zappfresh’s financial performance in FY24 reflects its strategic growth and market presence, though falling short of its initial revenue projections.
In the midst of a significant increase in IPOs within the Indian startup landscape, Zappfresh has emerged as the most recent entity to announce its intention to go public.
The company’s public offering includes a new issuance of 59.06 lakh equity shares, each with a face value of Rs 10. No current shareholders are selling their stakes in the company through the offer for sale component of the IPO.
This announcement follows shortly after Zappfresh’s acquisition of Bonsaro, an online brand specializing in meat and seafood delivery, with operations in Mumbai, with the aim of expanding its presence into the western regions of the country.
