There has been some positive news from the corridor of e-commerce business of Flipkart ‘Flipkart Internet’ which has witnessed its income rise and loss slump in the FY17.
The company’s loss fell by 30 per cent to Rs 1,638.6 crore in 2016-17 compared to the Rs 2,306.5 crore in the previous fiscal while it saw a 15.46 per cent rise in income to Rs 2,253.5 crore in the year ended March 2017 from Rs 1,951.7 crore in the previous financial year.
The loss cut happened as the company reduce logistics, storage services, and collection charges, along with other expenses, said documents filed with the Corporate Affairs Ministry.
The aforementioned figure of reducing losses and increasing revenues is in contrast of the business of the holding company Flipkart, which is based in Singapore.
A few month ago, paper.vc reported some numbers, sourcing from Flipkart’s filing with Singapore’s RoC, which showed Flipkart reporting a higher loss of 68 per cent in FY 2016-17 at Rs 8,771.4 crore after the fall in the company’s valuation back then.
The revenue of the company, however, grew by 29 per cent and stood at Rs 19,854.6 crore in the last fiscal.
The losses soared after the company raised capital led by Chinese Internet conglomerate Tencent at a much lower valuation of $11.6 billion in April 2017. The e-commerce company had raised $700 million from Tiger Global and existing investors, including Steadview Capital, at a massive valuation of $15 billion in 2015.
The fall in valuation raised the borrowing cost of the company to Rs 4,308 crore. The fair value loss on derivative financial instruments stood at Rs 3,412 crore in FY17.
Amidst this, the wholesale business of the company ‘Flipkart India‘ has also witnessed revenue rising 18 per cent to Rs 15,569.2 crore in FY17 from Rs 13,177.4 crore compared to the previous year. Besides, Flipkart India’s losses also fell to Rs 244.7 crore in FY17 from Rs 544.5 crore in the previous year, a 55 per cent decrease in losses, according to regulatory filings.
The development was first reported by ET.