Zepto spent Rs 5,747 Cr to earn Rs 4,454 Cr in FY24

Quick commerce startup Zepto reported a two-fold spike in revenue during the fiscal year ending March 2024. Meanwhile, the company managed to reduce its losses marginally by 2% during the same period.

Zepto’s revenue from operations surged 2.2X to Rs 4,454 crore in FY24 from Rs 2,026 crore in FY23, its consolidated financial statements sourced from the Registrar of Companies (RoC) show.

Zepto delivers over 25,000 products across various categories within 10 minutes via its extensive network of dark stores. The firm operates more than 550 dark stores and processes upwards of 700,000 orders daily.

Income from the sale of products formed 89.2% of the total operating revenue which grew by 120% to Rs 3,973 crore in FY24. The rest of the income came from delivery, warehousing, and advertising services.

Zepto also earned Rs 44 crore from non-operating income, primarily from interest on deposits, pushing its total income to Rs 4,498 crore in the last fiscal year, from Rs 2,077 crore in FY23.

For the quick commerce firm, the cost of procurement of products accounted for 60.5% of the overall expenditure. To the tune of scale, this cost grew 87% to Rs 3,481 crore in FY24. Its employee benefits rose to Rs 426 crore, marking a 62% year-on-year increase. This cost includes Rs 74 crore as ESOP cost (non-cash in nature).

Zepto significantly increased its spending on information technology and advertising in FY24, with these expenses rising by 65.7% and 40.3% to Rs 116 crore and Rs 303 crore, respectively. The company incurred Rs 493 crore in warehousing costs and Rs 580 crore in delivery expenses. These overheads contributed to a 71.6% rise in total expenditure, which grew to Rs 5,747 crore in FY24 from Rs 3,350 crore in FY23.

As Zepto's revenue growth outpaced its expenditure, the company’s losses decreased slightly by 2%, slipping to Rs 1,248.6 crore in FY24 from Rs 1,272 crore in FY23. Its Return on Capital Employed (ROCE) improved to -119.3%, and its EBITDA margin also showed progress, reaching -23.81%. The expense-to-earning ratio stood at Rs 1.29.

By the end of FY24, Zepto's current assets stood at Rs 1,398 crore, including cash and bank balances of Rs 692 crore.

Zepto recently secured $350 million in a funding round led by Motilal Oswal Private Wealth at a valuation of $5 billion. In 2024, it raised $1.35 billion, bringing its total funding to $1.85 billion since its inception.

With a 29% market share, Zepto is the second-largest player in the quick commerce sector, following Blinkit, which holds a 46% share, according to a report by Motilal Oswal. Swiggy Instamart ranks third with a 25% market share.

Led by Aadit Palicha, Zepto is also preparing to launch a standalone app for its 10-minute food delivery service, Zepto Cafe. This move will position it as a direct competitor to Swiggy’s Bolt, Swish, Zing Food, and Blinkit’s forthcoming service, Bistro. Palicha recently announced that the company aims to become profitable by FY26 and is planning to go public in the second half of the next year.

Zepto has been amply rewarded with investor largesse for doing the truly elusive startup dream. Actually disrupting a category where the rules seemed to be in place for the long haul. It's the same confidence that has seen it venture into food delivery as well, with no worries as yet on mundane stuff like conserving cash. How long will this state of mind last is anyone's guess, but we will stick our neck out and predict that around this time next year, the first murmurings will certainly start. The journey to that point will be exciting as hell, and we look forward to seeing just how many more surprises the no longer upstart firm has in store.