Myntra records Rs 31 crore profit in FY24, advertising expenses down by 4.63%

Myntra, the fashion e-commerce platform owned by Walmart, has reported a profit of Rs 30.9 crore for the fiscal year ending March 2024. This marks a significant turnaround from a loss of Rs 782.4 crore in FY23, highlighting the company's recovery through increased revenue and strategic cost management.

According to its consolidated financial statement, sourced from the Registrar of Companies (RoC), its revenue from operations grew by 14.71%, reaching Rs 5,121.8 crore in FY24, up from Rs 4,465 crore in the previous fiscal year. The revenue increase was largely driven by robust growth in logistics and advertising services, as well as stable marketplace income.

Logistics services accounted for 47.6% of the operating revenue, increasing by 22.5% to Rs 2,439 crore in FY24. Marketplace services remained steady, contributing Rs 1,774.6 crore, while advertising revenue surged by 33.07% to Rs 712.3 crore. Additionally, the company generated Rs 195.9 crore from other income sources, including Rs 51 crore from non-operating revenue, primarily from royalty income, bringing the total revenue to Rs 5,173 crore for FY24.

The company successfully managed to reduce its total expenses by 3.16% to Rs 5,123 crore, down from Rs 5,290 crore in FY23. Key cost optimisations included a 7.82% reduction in material costs to Rs 1,996.4 crore and a 4.63% cut in advertising expenses to Rs 1,677.4 crore. However, employee benefit expenses rose by 7.74% to Rs 800 crore, while other overheads, such as finance and IT costs, added Rs 650 crore to the overall expenditure.

This strategic expense management, combined with growth in high-margin revenue streams, allowed the company to achieve an EBITDA margin of 2.76% and a Return on Capital Employed (ROCE) of 11.07%, signalling a positive financial shift. The company's efforts to reach profitability were highlighted in March when the company disclosed achieving EBITDA profitability for the last two quarters of 2023.

It also reported a unit economics ratio of spending Rs 1.00 to earn a rupee, with cash and bank balances standing at Rs 37 crore and current assets valued at Rs 4,384 crore in FY24.

Under the leadership of Nandita Sinha, Myntra has also expanded its services to include the new quick commerce feature, M-Now, which promises deliveries of fashion and beauty products within 30 minutes. This move aligns with the growing demand for rapid delivery services in the e-commerce market.

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