Earlier this week, meat and seafood brand Licious became India’s first unicorn in the direct to consumer segment. The company has raised a total of $244 million during the last six months and recently filed its FY21 financial statements. Let’s take a deep look at its financial performance during FY21 which led up to this bumper fundraise.
The Temasek-backed company saw its revenue from operations swell up 3.2X to Rs 420.3 crore in FY21 from Rs 131.8 crore in FY20. Sales of meat, seafood, marinates and eggs accounted for 97.2% of the revenue during the pandemic-hit year while delivery and other related services made up the rest.
The cost of raw materials including meat, poultry and seafood products was the largest cost center for the D2C brand in FY21, accounting for 49.3% of the annual costs of the company. These costs grew in line with sales, growing 3.05X to Rs 318.7 crore in FY21 from Rs 104.3 crore in the previous fiscal.
The Bengaluru-based company also provides daily offers to customers on its platform to drive sales and shelled out Rs 34.5 crore on discounts during FY21. This cost jumped 3.3X in FY21 as compared to Rs 10.4 crore during FY20.
On-roll and off-roll salaries cost Rs 150 Cr for Licious in FY21
Licious also bolstered its employee base to harness the growing scale of operations across 16 cities in India and expenses related to employee benefits made up 18.42% of the total costs incurred during the year. Such costs grew by nearly 85% to Rs 119.1 crore in FY21 from Rs 64.5 crore spent during the period fiscal.
Apart from its own employees, Licious also utilises the services of subcontractors for procurement and transportation of its products. Fees paid to subcontractors surged 3.4x to Rs 30.1 crore in FY21 from Rs 8.9 crore paid in FY20 as the company revamped its supply chain operations during the pandemic.
Licious also spent Rs 28.1 crore on transportation and distribution of its products in FY21, registering a 132.2% increase as compared to Rs 12.1 crore in FY20.
Like most companies, Licious held back a growing cash burn on marketing during the pandemic hit year of FY 2020-2021. Its marketing and sales promotions cost increased by 36% to Rs 68.2 crore in FY21 from Rs 50.2 crore during FY20.
Licious’ unit economics improved by 29%
The company spent Rs 646.5 crore in total during FY21, registering a 128% increase as compared to aggregate costs of Rs 283.8 crore incurred in FY20.
On a unit level, Licious spent Rs 1.53 to earn a single rupee of revenue during FY21, improving by 29% from Rs 2.15 spent in FY20. While losses have grown by 153% to Rs 370 crore in FY21 for the growth stage company, its EBITDA margins have improved vastly from -95.12% in FY20 to -43.31% during FY21.
Licious has demonstrated impressive financial performance in FY21 and it seems that the company’s operation wasn’t hit by the pandemic. Since most of the offline meat and seafood shops were shut due to lockdown, meat-eaters in metros and tier I cities resorted to online platforms such as Licious and FreshToHome. The more than 3X jump in its operating revenue makes it evident.
Unlike most growth-stage startups, Licious has managed to grow with sound unit economics. Licious appears to have a leadership position in the online meat and seafood sector. With the recent fundraising, the company is poised to expand and ramp up its growth in India as well as the overseas market (majorly SEA and the middle east regions).