Over the past couple of years, the personal wealth management space has witnessed the debut of several companies such as Paytm Money, Groww and INDMoney(previously INDwealth). The segment is in a nascent stage, which is reflected in the financials of INDMoney for the fiscal year 2019-20.
In its second year of operations, the company recorded an operating revenue of Rs 1.07 crore. The Gurugram-based company took a 2.3X jump in its total income to Rs 7.26 crore from Rs 3.17 crore in FY19.
Importantly, income from fixed deposits and mutual funds amounting to Rs 6.2 crore made up 85.4% of INDMoney’s topline during FY20. The non-operating revenue increased by 95.6% from Rs 3.17 crore earned in FY19.
INDMoney generates operating revenue mainly through advisory fees collected from premium users on its platform and distribution fees collected from the AMCs and mutual funds.
Income from distribution fees stood at Rs 71.34 lakh, making up 66.8% of the revenue from operations whereas the company collected Rs 35.4 crore from its users as advisory fee during FY20.
Salaries and employee benefits have emerged as the largest expenditure for INDMoney. Such costs ballooned 7.6X to nearly Rs 13 crore from Rs 1.72 crore in FY19 as the company increased its talent pool with the scale of operations. It was the single biggest cost factor for the company, making up 68% of the total expenses in FY20.
Other operating expenses including rent and administration also grew 4X to Rs 4.8 crore in FY20 from Rs 1.15 crore in FY19. Depreciation and amortization expenses of Rs 1.36 crore pushed INDMoney’s total expenditure during FY20 to Rs 19.12 crore, registering a 6.25X jump from Rs 3.06 crore in FY19.
The personal wealth management startup lost Rs 11.74 crore during the fiscal ended in March 2020 at an EBITDA margin of -44.65%. Interestingly, it had posted a profit of Rs 10.65 lakh in FY19 on account of income generated through its financial assets.
The company purchased non-current investments worth Rs 209.4 crore throughout the last fiscal and holds 65.4% of its total assets in the form of such investments.
While INDMoney had announced a $30 million or Rs 220 crore financing round in November 2018, the company has received $40 million or Rs 294 crore during FY20. INDMoney has been using this capital in its primary operations in the ongoing fiscal to grow its scale and compete with the likes of deep-pocketed players such as Paytm Money and Sequoia Capital-backed Groww.