Business-to-business (B2B) agritech firm Ninjacart has emerged as the market leader in the space if we consider its financial performance during the last few fiscal years. In FY22, the Bengaluru-based company grew 28% even as it got closer to control over its losses.
Ninjacart’s revenue from operations grew 28% to Rs 967 crore during the fiscal year ending March 2022 from Rs 755 crore recorded in FY21, the company’s annual financial statement with the Registrar of Companies (RoC) shows.
Sales of fruits and vegetables accounted for the main source of revenues and contributed over 82% to the total operating income. Collection from this vertical surged 23.3% to Rs 795.5 crore during the last fiscal year from Rs 645.3 crore in FY21.
Collection from the sale of grains and other food staples accounted for around 17% of the revenue and jumped 66% to Rs 162.2 crore during FY22. The company also generated Rs 9.7 crore from delivery services during the same period.
Ninjacart booked a non-operating revenue of Rs 24 crore mainly from interest on fixed deposits and other current investments which drove the total income to Rs 991 crore during FY22.
Started as a B2C in 2015, Ninjacart quickly pivoted to the B2B model and enables retailers, restaurants, and sellers in mandis to source fresh produce directly from farmers. The company claims to have over 200 collection centres and 1,200 warehouses in India and moves over 1,400 tons of fresh produce across seven cities including Bengaluru, Chennai, NCR, and Mumbai-Pune region.
On the expense front, the cost of goods sold emerged as the biggest cost element forming over 70% of the total expenditure. This cost surged 34.7% to Rs 915.8 crore in FY22 from Rs 679.8 crore in FY21. Employee benefits expense was the second major cost for the company even as it remained flat at Rs 162.8 crore during FY22. This also includes equity-settled employee share-based payment of Rs 9.94 crore.
Spendings on logistics and commission paid to sell agents shrank 53% and 48% to Rs 60.8 crore and Rs 38.7 crore respectively in FY22. The company also incurred Rs 15.7 crore worth of utility costs such as rent, communication, safety, security, and others during the last fiscal year.
In total, the annual expenditure of the company increased 12.7% to Rs 1,299 crore in FY22 as compared to Rs 1,153 crore booked in the previous fiscal (excluding impairment loss on non-financial assets of Rs 647 crore during FY21). During the year, the company managed to control its losses by 18.1% to Rs 308 crore against Rs 376 crore in FY21.
Ninjacart also managed to control its operating cash outflows by 18.8% to Rs 263 crore during FY22.
Coming to ratios, EBITDA margin and ROCE improved to -28.04% and -24.68% during the year. On a unit level, the company spent Rs 1.34 to earn a rupee of operating revenue in FY22.
In December 2021 (during FY22), the Tiger Global-backed company raised $145 million from Walmart and Flipkart at a valuation of $815 million to join the soonicorn list. According to data compiled by Fintrackr, more than 100 agritech startups raised close to $1.4 billion between January 2020 and November 2022. DeHaat and Waycool are valued close to Ninjacart. While Ninjacart missed the Rs 1,000 crore revenue mark by a small margin, DeHaat and Waycool reported Rs 358 crore and Rs 382.33 crore in revenue in F21 respectively. They are yet to file FY22 numbers.
For Ninjacart, which must be targeting profitability by FY24 possibly, the control on employee costs, besides the drop it has managed in logistics costs indicates the firm is much closer to a level of consolidation, a loss-making business needs before pushing for the next phase of growth. The fresh produce market, even for B2B is a very tough and competitive market, with the key urban centers (where Ninjacart is also focused currently) enjoying a very high share. Expanding beyond these regions will again entail high investments. For Ninjacart, the big question therefore might be to take a call between wringing out more efficiencies and broadening offerings to existing customers, or expanding in search of more customers. It will need to decide before the decision is taken out of its hands by the reserves at hand with it.