ZappFresh ends FY23 with profit and Rs 57 Cr revenue

ZappFresh’s scale has remained relatively small compared to its D2C meat delivery rivals and posterboys of the space, Licious and FreshToHome. However, this hasn’t disadvantaged ZappFresh, as demonstrated by its consistent performance in the last two fiscal years.

Even as Licious and FreshToHome have bled profusely, ZappFresh remained profitable in FY22 and FY23.

“We did Rs 70 crore revenue in FY23,” Deepanshu Manchanda, founder and chief executive officer of ZappFresh, told Entrackr.

This essentially means the revenue from operations in FY23 remained flat from Rs 56 crore collections in FY22. Manchanda said the reason for the marginal growth was the company’s priority towards sustainable growth in the last two fiscal years “instead of buying scale.”

Operational in Delhi-NCR and Bengaluru, the company sells fresh meat, seafood, and ready-to-cook items through its app and website.

“We deliver around 4,500 orders on a daily basis with an average basket size of Rs 600,” Manchanda added.

Unsurprisingly, procurement of materials was the largest cost center for ZappFresh in FY23. It accounted for 40-50% of the overall expenditure while employee benefit and advertisement costs formed 10% each to the overall cost, the founder said.

The company also managed to control expenses during the previous fiscal year and grew its profit as compared to FY22.

Manchanda disclosed that the company’s profit stood at around Rs 3.5 crore in FY23. “...we are looking to end the ongoing fiscal with two-fold growth in profit after tax.”

The seven-year-old company has raised over $9 million to date. Its co-founders hold around 40% of the stake while SIDBI is the largest external stakeholder with 21%, according to the data tracking and startup intelligence platform TheKredible. 

ZappFresh recently acquired Dr. Meat for about $3 million and the acquisition will help in growth. “We are confident to hang around Rs 200 crore in collection in the ongoing fiscal year,” added Manchanda.

As mentioned above, ZappFresh rivals have bigger scale but at the same time they have been making huge losses. For instance, FreshtoHome posted Rs 102 crore revenue (GMV of Rs 1,100 crore) and Rs 477 crore loss in FY22.

Temasek-backed Licious’ topline stood at Rs 682 crore in FY22. Licious, the only unicorn and poster boy in the D2C meat delivery space, had a loss of Rs 855 crore in the same period. These two companies are yet to disclose FY23’s numbers.