Gold loan startup Rupeek’s scale soars over 3X during FY21

Online platform for gold-backed loans Rupeek grew at a quick clip during FY21 as individuals turned to it to borrow money against their gold holdings. Its revenue from operations multiplied 3.1X to Rs 63 crore during FY21 from Rs 20.6 crore in FY20, the company's annual financial statement filed with RoC shows. 

Rupeek also made non operating income of Rs 25.7 crore during the period, 127.4% more as compared to FY20.

In the past few years, Rupeek has been an early-mover in the online gold financing sector which has been abuzz with new and well-funded well-funded entrants—notably Indiagold. The Bengaluru based company serves as a funnel for loans against gold as collateral with interest rates ranging from 5.88% to 21.48% (depending on tenure) and charges commission income from the NBFCs for facilitation of these loans. 

With the growth in the last year, the company spent a good chunk of money on its workforce. Expenditure on employee benefits was the single largest cost centre for the company, accounting for nearly 49% of the annual costs. These expenses surged in line with growth in scale and grew 2.3X to Rs 120 crore in FY21 from Rs 53.3 crore in the preceding fiscal year. Rupeek handed out share-based payments of nearly Rs 13 crore to its employees during the last fiscal.

Finance costs grew 5X to Rs 6.35 crore while legal professional payments have doubled to  Rs 9.82 crore during FY21. 

Rupeek’s income statement also lists “Miscellaneous expenses” which dropped by 80% to Rs 91.74 crore from Rs 44.7 crore booked in FY20. Importantly, Rupeek recorded notional expenses of Rs 406.8 crore during FY20 on account of fair value changes of financial instrument(CCPS) according to Indian accounting standards which inflated the expenses.

Rupeek has confirmed to Entrackr that it has restated the financial statements for FY20 and FY19 in accordance with Ind AS for comparative information.

Overall, the GGV-backed startup has spent Rs 245.3 crore in total during FY21, 53% less as compared to Rs 520 crore spent during FY20. This sudden decrease in expenditure is primarily due to the booking of notional expenses amounting to Rs 406.8 crore during FY20.

Rupeek spent Rs 3.9 to earn a single rupee of revenue during FY21 as compared to Rs 25.24 spent to earn the same during FY20.

Due to the sharp reduction in costs, the company saw its annual losses reduce by 68% to Rs 156.4 crore in FY21 as compared to Rs 488 crore during FY20. While EBITDA margins have also improved to -157.7% in FY21 from -1503.7% in FY20, Rupeek’s balance sheet sported outstanding losses of nearly Rs 900 crore as of March 31, 2021.