SUMMARY
- Neobanking firm Open’s revenue from operations fell to Rs 24.81 crore in FY24 from Rs 29.9 crore in FY23.
- The company’s total expenses were reduced by 34.4%, reaching Rs 194.65 crore in FY24 from 296.85 crore in FY23.
- It managed to narrow its losses by 30%, reaching Rs 169.68 crore in FY24 compared to Rs 242.2 crore in FY23.
Despite experiencing a 25% increase in scale during FY23, Bengaluru-based neobanking firm Open witnessed a 17% decline in its scale.
The firm’s revenue from operations fell to Rs 24.81 crore in FY24 from Rs 29.9 crore in FY23, as reported in its annual financial statement submitted to the Registrar of Companies (RoC).
Additionally, Open generated Rs 21.3 crore from interest and gains on current investments (non-operating revenue), contributing to its overall revenue of Rs 46.11 crore for the year. This non-operating income significantly contributed to the company’s total revenue despite facing challenges in its core business operations.
Since its inception in 2017, Open has generated approximately Rs 100 crore from its operations, while its outstanding losses have amounted to Rs 1,831 crore at the end of FY24.
The company specializes in developing digital business payment solutions, offering businesses a fully digital current account and a suite of integrated tools for finance, accounting, and credit, in collaboration with banking and lending partners.
According to its website, Open has served over 3.5 million clients and processes annual transactions valued at more than $35 billion.
As for the expenses, employee benefits emerged as the largest cost contributor, accounting for nearly 60% of the total expenses. This cost decreased by 21.6% to Rs 117.08 crore in FY24 from Rs 149.25 crore in FY23. Notably, this expense also includes costs related to the employee stock option plan (ESOP) amounting to Rs 37 crore in the year under review.
IT and payment gateway expenses saw a 13.2% reduction to Rs 25.34 crore from the previous year. Advertising and promotion expenses saw a decline of 84.7%, dropping to Rs 8.85 crore in FY24 from Rs 57.67 crore in FY23.
The company’s total expenses were reduced by 34.4%, reaching Rs 194.65 crore for the year under review. Following these cost-cutting measures, Open managed to narrow its losses by 30%, reaching Rs 169.68 crore in FY24 compared to Rs 242.2 crore in FY23.
Moreover, operating cash outflows witnessed a 55.4% improvement, falling to Rs 91.57 crore in FY24. While these figures suggest progress, it appears that this improvement is primarily attributed to a slowdown in operational efficiency rather than an increase in core business performance.
Overall, Open’s outstanding losses amounted to Rs 1,831 crore at the end of FY24. The EBITDA margin and ROCE were -264.50% and -45.61%, respectively. On a unit level, the company spent Rs 7.85 to generate a rupee in the year under review.
