VAHDAM India narrows losses by 68% to Rs 18 Cr in FY24

Direct-to-consumer (D2C) tea brand VAHDAM India experienced modest double-digit growth during the last fiscal year. Despite this, the company significantly improved its unit economics by reducing losses by 68%, bringing them down to under Rs 20 crore.

VAHDAM India's revenue from operations grew by 10.6% to Rs 225.2 crore in FY24 from Rs 203.6 crore in FY23, as per its consolidated financial statement filed with the Registrar of Companies (RoC).

VAHDAM directly sources premium tea and spices from farms and estates across India. It sells these products to customers both locally and internationally, including in the US, Canada, and Europe, through its own website and online marketplaces.

Product sales contributed 99% of VAHDAM's operating revenue. Geographically, the USA remained the primary revenue driver, accounting for 68.5% of the total operating revenue, with an 12% growth to Rs 154.2 crore. Revenue from India grew by 18% to Rs 14.84 crore, while Europe and the rest of the world contributed Rs 37.4 crore and Rs 18.8 crore, respectively, showing steady growth of 5-6%..

The company made additional Rs 10 crore from non-operating revenue which pushed its total revenue to Rs 235 crore in FY24.

On the expense side, VAHDAM curtailed major costs. Advertising expenses, one of its significant outlays, were reduced by 18.9% to Rs 50 crore in FY24. Freight and forwarding charges also declined by 7% to Rs 68 crore. Meanwhile, the cost of materials remained stable at Rs 47 crore, and employee benefit expenses rose by 18.4% to Rs 29 crore. Other overheads stood at Rs 58.9 crore.

Overall, the company's total expenses fell by 4.7% to Rs 253 crore in FY24, from Rs 265.5 crore in FY23. 

The Delhi based firm’s losses declined by 68% to Rs 17.7 crore in FY24 from Rs 55 crore in FY23. Its ROCE and EBITDA margin stood at -13.2% and -4.26%, respectively. Its expense-to-earning ratio stood at Rs 1.12. 

As of March 2024, the firm reported Rs 142 crore of current assets including Rs 83 crore of cash and bank balance.

According to TheKredible, VAHDAM India has raised a total of $39 million in funding till date, having Fireside Ventures, Sixth Sense Ventures and IIFL Asset Management as its lead investors.