The Good Glamm Group has emerged as the poster boy in content cum commerce play. If this wasn’t evident from its unicorn status and the number of acquisitions (13) it has made in the past two years the company is now looking to raise a new round at a valuation of $2 billion to consider more acquisitions, among other things.
While the impact of these acquisitions and fundraise on Good Glamm Group’s growth and scale will be analyzed after the company files its FY22 financial results, its growth has been underwhelming during FY21.
The content-to-commerce platform has reported a 12.2% growth in its operating revenues during the fiscal year March 2021 at Rs 49.32 crore as compared to Rs 43.95 crore in the previous fiscal year (FY20), according to its annual financial statements with the Registrar of Companies (RoC).
Besides the sale of products and services, the Pune-based firm has generated nearly Rs 19 lakh as affiliate and adsense income in FY21. Good Glamm Group also earned a non-operating income of Rs 78 lakh in FY21 through its financial assets that shrank by 69.3% from Rs 2.54 crore in FY20.
Good Glamm Group claims to be the largest DTC beauty platform which consists of personal care brands – MyGlamm, The Moms Co, St. Botanica, Sirona and Organic Harvest while its content portfolio includes POPxo, Scoopwhoop, BabyChakra, MissMalini among others.
On the expense front, employee benefit expense emerged as the largest cost center for the firm contributing over 38% in the total annual expenditure. This cost surged 76% to Rs 34.9 crore in FY21 from Rs 19.82 crore in FY20. This cost also includes Rs 1.71 crore as employee stock options (ESOPs) expenses.
Purchase of cosmetics products stood as the second major contributor in total expenses. This cost increased 26.4% to Rs 17.41 crore in FY21 from Rs 13.77 crore during FY20. Marketing and promotion expenses shrank by 73.2% to Rs 14.05 crore in FY21 from Rs 52.37 crore in FY20.
Warehousing & logistics and customer incentive decreased by 25% to Rs 10.37 crore in FY21 from Rs 13.82 crore in FY20. IT and communication costs that include software development and technology expenses, rose 14.6% to Rs 2.83 crore in FY21.
Good Glamm Group also incurred content development charges of Rs 3.02 crore in FY21. Overall, the total expenditure of the company decreased by 17.3% to Rs 91.2 crore as compared to Rs 110.3 crore in FY20. On a unit level, the company has spent Rs 1.85 to make a single unit of operating revenue.
The Darpan Sanghvi-led company controlled its losses by 36.3% from Rs 68.5 crore in FY20 to Rs 43.63 crore in FY21. The company reported Rs 58 crore as cash outflows from operations in FY21, contracting 37.3% as compared to Rs 92.5 crore in the previous fiscal year (FY20).
As the company cut down its annual expenditure and cash outflows, the EBITDA margin improved from -134.91% in FY20 to -74.21% during the fiscal year ending March 2021.
The scale of most e-commerce companies had contracted in FY21 as the fiscal was mostly disrupted by the pandemic-led lockdowns. This appears to be the biggest reason for the sluggish growth in Good Glamm Group’s income in FY21.
Good Glam Group’s push towards adding content firms across verticals played out in FY 22, and it should make for very interesting results when they are declared. Many industry watchers have expressed doubts about such a strategy when smaller ‘influencers’ have popped up all over social media, creating an alternate view on content-led growth.
