Logistics SaaS startup WheelsEye is building its technology platform for trucking operators, providing the technology platform for the unorganised logistics sector in India. The company which was launched in 2017 by former Shuttl executives Anshul Mimani and Manish Somani has witnessed a flat growth in the fiscal ended in March 2021.
WheelsEye’s revenue from operations has shrunk by 2% to Rs 82.4 crore in FY21 from Rs 84 crore earned in FY20.
The Gurugram-based company provides GPS tracking, FASTag and data analytics solutions to trucking operators and large businesses. It claims to have over 700k verified operators on its platform across 600 districts in India. Data analytics SaaS services is the largest income driver for the company, bringing in 44% of its annual revenues. Revenues from this vertical grew by 160% to Rs 35.9 crore during FY21 from Rs 13.81 crore in FY20.
WheelsEye also offers logistics solutions to large businesses but has shifted focus from this vertical to focus primarily on providing technology solutions to existing trucking companies. Hence, revenue from this segment dropped 97.3% to only Rs 1.2 crore in FY21 from Rs 43.46 crore in FY20. This is also the segment that sees intense competition right now.
Expectedly, the sale of FASTag and GPS tracking equipment is a key and second-largest revenue driver, accounting for 30.6% of WheelsEye’s revenue from operations. These sales amounted to 25.18 crores during FY21, growing a mere 1.8% as compared to sales of Rs 24.74 crore in FY20.
Commission from bookings and FASTags registered the highest growth, growing 905.5% to Rs 20.1 crore during FY21 from only Rs 2 crore in FY20.
The company has increased its employee base significantly to harness growth and employee benefit expenditure is the largest cost centre of the company, accounting for 37.4% of the annual expenses. These payments grew by 167% to Rs 69.7 crore during FY21 from Rs 26.53 crore paid out in FY20.
Outsourcing and subcontracting charges paid to outside agents is the second largest cost for WheelsEye, making up 20% of annual costs. These payments contracted to Rs 37.3 crore during FY21 from Rs 59.73 crore as the company integrated operations internally.
Further, WheelsEye’s expenses on GPS, FASTag installation and operation costs also dropped by 49%YoY to Rs 32.43 crore during FY20 as new installations were curtailed due to countrywide lockdowns.
Likewise, the cost of procuring the GPS hardware and ancillary equipment also dropped by 16.4% to Rs 24.6 crore in FY21 from Rs 29.41 crore in FY20 and the company utilised its existing inventories. This contraction in new GPS installation can also be witnessed from the contraction in the Inventory turnover ratio which dropped from 12.08 times in FY20 to 5.66 times in FY21.
Costs incurred on research and development and server operations amounted to Rs 6.66 crore, pushing the annual cost to Rs 186.6 crore in FY21 which was reduced by 2.6% from Rs 191.6 crore during FY20. On a unit level, WheelsEye spent Rs 2.26 to earn a single unit of revenue during the last fiscal year.
While the growth slowed down during the year marred by COVID 19 disruptions, WheelsEye’s annual losses were reduced by 6.9% to Rs 99.2 crore in FY21 from Rs 106.6 crore lost in FY20.
WheelsEye has been facing stiff competition from established technology focussed logistics companies including Blackbuck and Rivigo. During the last year, WheelsEye also filed a suit against Blackbuck in the Delhi High Court accusing the latter of systematically poaching employees and influencing their tech hardware vendors to its detriment.
With all that, the firm faces a massive challenge going ahead to continue to scale up and churn profits. While a growing, relatively untapped trucking sector continues to offer massive opportunity, intense competition, as well as the slightly regional nature of the business continues to suck in huge investments to build a national reach and presence. With large fleet operators increasingly locked in first, the market that will decide winners is made up of much smaller operators, including single truck owners. That makes it essential to find low-cost ways to reach and service them. The picture should be a lot clearer as more operational details come out for 2021-22.