iNurture crosses Rs 100 crore revenue in FY22, slips into losses

Higher education-focused ed-tech solution provider iNurture claimed a $29 million (Rs 220 crore) turnover with an EBITDA of $2.5 million (Rs 19 crore) for FY22. However, the company missed the claim by a huge margin as its scale barely grew to a little over Rs 100 crore and slipped into losses during the last fiscal year.

The 18-year-old company has partnerships with over 30 university campuses across India, offering over 50 programs on campus, and claims to have more than 15,000 students enrolled in these programs. Soon after FY22, it raised $15 million in a combination of debt and equity from ADM Capital for further expansion.

Course fees received from the students registered for different courses and the services rendered to colleges and universities formed over 99% of its total collection which moved 4.8% to Rs 101.88 crore in FY22, according to its consolidated financial statement with the Registrar of Companies (RoC).

Revenue from registration and prospectus fees stood at Rs 24 lakh in the last fiscal year while it also has a financial income of Rs 52 lakh.

When it comes to costs, employee benefits formed 42.1% of the overall cost and cost grew 11% to Rs 45.48 crore during FY22.

Reimbursement of faculty costs to universities was the second-largest cost center after employee benefits which contributed 15.9% of total expenses. This cost shrank 32.4% to Rs 17.2 crore in FY22.

Advertising expenses and the costs for guest faculty surged 40.1% and 127.3% respectively to Rs 7.86 crore and Rs 8 crore during FY22. iNurture also incurred  Rs 5.58 crore on program development and certification costs which pushed its total cost by 9.4% to Rs 108.1 crore in the last fiscal year.

With growth stagnating and the surge in costs, the company slipped into losses and registered a loss of Rs 5.4 crore in FY22. Significantly, it was in green during FY21 with a yield of Rs 10 lakhs.

Its ROCE and EBITDA margin worsened to -0.81% and 5.95%. The firm spent Rs 1.06 to earn a single unit of operating revenue in the last fiscal.

With its focus on education or training to make students more industry ready, iNurture has picked a pretty large use case opportunity for itself, considering the huge employability issue highlighted over the years for graduates in India. A problem particularly acute in tier 2 institutes, the opportunity is massive, although institutes themselves, and many other players are also on to the problem now.

That makes fund backing important because convincing many of these large tier 2 universities is a long and high involvement effort with the type of courses iNurture offers. Everything, from pricing (issue of revenue share) to duration and when these are offered (final year or earlier) has to be thrashed out. This ‘job prep’ market has a long way to go yet, and it remains to be seen whether iNurture does it on its own steam or with more fuel from investor funds. The differentiator here will be strong use cases or industry testimonials, that could really help with faster expansion and acceptance.