Intra-state logistics marketplace LetsTransport has registered a 2.3X growth in revenue during the last two fiscal years and crossed Rs 400 crore in FY22 from Rs 175.3 crore in FY20, according to the company’s annual financial statement reviewed by Entrackr.
LetsTransaport operates on an asset-light model and allocates delivery to a network of aggregated trucks and enables intra-city logistics for large enterprises, supply chain companies, and local retailers. Income from logistics services is the sole source of revenue for the Bengaluru-based company which surged 94.8% to Rs 403.37 crore in FY22 from Rs 207.08 crore in FY21.
The company also earned Rs 3.93 crore from the interest on fixed deposits and miscellaneous non-operating income during FY22.
Transportation costs which include all vehicle-related and delivery personnel costs accounted for 78.2% of the overall cost. This cost grew 2X to Rs 375.57 crore in FY22 from Rs 183.87 crore in FY21.
To keep up with the growing scale, the company’s employee benefit expenses grew 22.5% to Rs 55.89 crore in FY22 from Rs 45.64 crore in FY21. It also includes Rs 1.18 crore as ESOP expenses which were non-cash in nature.
Legal professional charges and the cost for website hosting/software licenses were recorded at Rs 3.02 crore and Rs 1.85 crore respectively during FY22 which took LetsTrasports’s overall cost up by 80.3% to Rs 480.36 crore in FY22 from Rs 266.49 crore in FY21.
With control on costs, the seven-year-old company saw its losses rise by only 32% to Rs 73.06 crore in FY22 from Rs 55.28 crore in FY21 even as growth took off. Its ROCE and EBITDA margin was recorded at -117.33% and -12.36% during FY22. The company spent Rs 1.19 to earn a single unit of operating revenue.
Intra state/city logistics, while providing the obvious advantages of better control and visibility for logistics firms, remains a very competitive market. With the intra-state focus comes fewer border hassles too, a huge challenge to manage even today.
For a firm like LetsTransport, it’s a very fine line between a competitor and a partner at times, that’s how crowded the market can be. That makes the task of turning a profit in the business challenging, even as scale and growth can be delivered with pricing or other features. The firm has done well to put together a strong list of clients, and it remains to be seen what value add or differentiator the firm can add to stand out and make its delivery trips profitable.