After witnessing a dip in FY21, OnEMi Technologies, the parent entity of consumer lending platform Kissht and digital payment app RING, has managed to impress with its financial performance. The Mumbai-based firm turned profitable in FY22 and during FY23, it crossed Rs 1,000 crore threshold marking a significant jump in topline.
The company’s revenue from operations soared nearly two fold to Rs 1,020.9 crore during the fiscal year ending March 2023 in contrast to Rs 513.6 crore in FY22, as per the company’s consolidated financial statements with the Registrar of Companies.
Operating Revenue Total Expense Profit / Loss
Profit / Loss
Led by Krishnan Vishwanathan and Ranvir Singh, OnEMi runs two brands, Kissht and RING, and offers a credit gateway technology, credit assessment and credit marketplace platform for provisioning of instant consumer loans on digital channels and providing a lending platform that aggregates underwriters in one platform.
“RING contributed to around 70% of the overall operating revenue during FY23 and also owns a significant part in profits”, said Ranvir Singh, co-founder of Kissht & RING in an interaction with Entrackr.
OnEMi also has a wholly owned subsidiary Si Creva that acts as a NBFC and provides financing for multiple products including consumer loans for purchase of goods and services.
The company claims to have boarded 4 million new customers in the last 12 months and currently has a total subscriber base of over 10 million along with over 1.2 lakhs online and offline merchant partners. As per the company, repeat customers contributed to over 90% of the business volume during the last fiscal.
The company generated the majority of its revenue from processing fees collected at the time of the release of loans which accounted for around 55% of the overall operating revenue. It also made a significant part of revenue from interest on loans and fees income (charged on other products such as insurance) along with interest income, marketing, business correspondent and other ancillary services.
Besides this, the entity also earned Rs 16.6 crore from other financial assets during the year which took the overall revenue to Rs 1,037.5 crore in FY23.
Moving towards the expenses, the company booked over 50% of the total expenses as provisions and write-offs. This cost doubled to Rs 493.3 crore in FY23 from Rs 242.3 crore in FY22. This primarily includes Rs 258.5 crore as written off value of bad debt against the credit it offered and Rs 148.5 crore as provision for portfolio under business correspondent arrangements (risk cover to its lending partners).
This was followed by outsourcing and back office expenses which also surged at the same time to Rs 123.63 crore during the year.
Spends on employee benefits went up 94.7% to Rs 111 crore in FY23, this also includes ESOP cost of over Rs 30 crore. Promotional and business support charges were the two other major costs during the year. At the end, total expenditure of the company inclined 110% to Rs 973 crore in FY23 from Rs 463 crore in FY22.
Even after a significant surge in scale, the profits of the company did not grow which can be attributed to the ESOP related expenses. Kissht’s profit shrank 5.8% to Rs 59 crore in FY23 against Rs 62.6 crore recorded in FY22. However, ESOP cost is a non-cash expense and excluding this, the company’s profits surged over 45% to Rs 95.5 crore in FY23.
Furthermore, operating cashflows of the company turned positive to Rs 48 crore during FY23 as compared to negative Rs 15.63 crore in FY22.
The EBITDA margin ROCE of Kissht worsened to 12.11% and 18.76% in FY23. On a unit level, Kissht spent Rs 0.95 to earn a rupee of operating income.
Expense/₹ of Op Revenue
As per the data intelligence platform TheKredible, Kishht has raised over $150 million (equity + debt) to date from the likes of Brunei Investment Agency, Vertex Ventures, Ventureast and more. As of its latest funding round in June 2022, Ranvir Singh is the largest shareholder in the company followed by Vertex Ventures and Fosun RZ Capital. For complete funding history, shareholding pattern and more, visit here.
In Feb this year, the website of Kissht was blocked following a notice from the Ministry of Electronics and Information Technology (MeitY) targeting over 200 gambling and lending apps, most of which appeared to be operated from China.
Later, however, a government official clarified that this block might have been done inadvertently. It could be due to an error when dealing with apps that sound similar.
Kissht certainly seems to have been saved by its fee based income in FY23, even as its lending from its own funds is none too impressive. The website troubles may or may not have been linked to China’s Fosun that has invested in the firm, but should be behind it for good. The challenge for Kissht will be to stand out in a marketplace that is increasingly getting crowded, and growth can be powered only with fresh infusions of capital. Being acquired by a larger player is always an option, but that requires strong momentum in sales and profits now, which Kissht doesn’t really have at this stage.