Mamaearth’s scale surges 2X in FY22, stays profitable


Direct-to-consumer (D2C) skincare and beauty brand Mamaearth turned unicorn in FY22 after raising a $52 million Series F funding round led by Sequoia Capital. Capitalizing on the proceeds, the company has continued its momentum in terms of scale and neared the Rs 950 crore mark in FY22.

The Gurugram-based firm’s operating revenue grew 2X to Rs 943 crore in FY22 from Rs 460 crore in FY21, as per the annual financial statements with the Registrar of Companies (RoC). Significantly, it remained profitable in FY22.


The firm made 93% of its collection from domestic sales which increased by 103% while it also made non-operating revenue of Rs 20.8 crore from interest on fixed deposits and gain on investments. The income here grew 72.4% in FY22.

The D2C brands splurge heavily on marketing-that made advertising the largest cost center for Mamaearth forming around 41.5% of total costs. The expenses on this account spiked 2.2X to Rs 391 crore in FY22.

As the company doubled its scale, the cost of material consumed and employee benefit expenses soared 2.12X and 2.8X to Rs 283 crore and Rs 79 crore respectively in FY22 which also includes Rs 16.7 crore on ESOPs.


Freight cost grew 70% to Rs 92 crore whereas commissions paid to influencers and third-party marketplaces surged 123% to Rs 29 crore. That took  Mamaearth’s total expenses to Rs 942 crore in FY22.

On the back of its scale, the Sequoia-backed company registered a profit of Rs 14.4 crore during the last fiscal year. The cash flow from operations remained positive at Rs 44.6 crore.

Importantly, in reclassified financials for FY22, the company showed a cost of Rs 1,361.2 crore as the change in the fair valuation of preference shares in its corresponding year (FY21), which is a non-cash expense. The company added this cost due to the internal shareholder agreement (SHA).


With strong fundamentals, the company spent Rs 1 to earn a single unit of operating revenue. Mamaearth has demonstrated solid growth in scale during FY22 and remained profitable which is rare amongst other consumer internet companies of its age. The company emerged as the flagbearer of the direct-to-consumer (D2C) space beyond Nykaa.

Its growth story is expected to stay strong in the ongoing fiscal year as the company aims to raise $300 million via an IPO sometime in 2023. Entrackr was the first to report about its IPO plans in May. Perhaps the only risk factor remains the high discount-led selling, which, besides high advertising costs, drags down margins on what was considered a very high-margin category till recently.

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