SUMMARY
Appario Retail’s profit for FY22 shot up by 53% compared to the INR 53.84 Cr it posted in FY21
In FY22, the etailer’s expenses stood at INR 15,807.09 Cr, 8.5% higher than the INR 14,564.57 Cr it earned last fiscal
Appario Retail is one of the biggest sellers on Amazon India and is set to shut down in 12 months
Appario Retail, the Amazon etailer that is set to shut down in a year, posted an operating revenue of INR 15,915.62 Cr in FY22, along with a profit of INR 82.5 Cr for the fiscal.
According to the regulatory filings accessed by Inc42 via Tofler, Appario Retail’s profit for FY22 shot up by 53% compared to the INR 53.84 Cr it posted in FY21. The operating profit also increased by 9% compared to the INR 14,628.64 Cr last fiscal.
While Appario’s profits increased by 9%, its expenses increased by a similar amount as well. In FY22, the etailer’s expenses stood at INR 15,807.09 Cr, 8.5% higher than the INR 14,564.57 Cr it earned last fiscal.
Of the total expenses, the biggest expense was the purchase of stock in trade, clocking in at INR 14,470.98 Cr in FY22, up 6% from INR 13,674.18 Cr in FY21. Appario Retail managed to reduce its employees’ benefits expense by 30% to INR 40.9 Cr in FY22 from INR 58.6 Cr in FY21.
Appario Set To Shut Shop In 12 Months
Appario Retail is one of the biggest sellers on Amazon India and operates under the aegis of Frontizo Business Services, the ecommerce major’s joint venture (JV) with Patni Group-owned Zodiac Wealth Management.
In a joint statement on October 31, Amazon and Zodiac Wealth Management said that they have extended their JV, Frontizo Business Services, for a reported three more years. However, Appario Retail will cease to be a seller on Amazon and Amazon Business in the next 12 months.
“The partners will continue to explore new business opportunities, including helping businesses across India to scale up their online presence,” the companies added.
The move comes against the backdrop of stricter ecommerce rules in India. Previously, ecommerce rules barred such platforms from holding and selling inventory directly to consumers. So, ecommerce players used to tie up with local companies to operate several joint ventures to bypass these rules.
Therefore, the new rules state that ecommerce platforms can’t hold equity in a seller listed on their platform. This forced Amazon to earlier slash its stake in both Appario and Cloudtail.
Following such increasing regulatory pressures and the ongoing investigation from the Competition Commission of India (CCI), the ecommerce giant was forced to shut both sellers down.
Cloudtail and Appario were the top two biggest sellers on Amazon India. Reportedly, both Amazon-backed sellers accounted for a third of the ecommerce major’s sales in India in early 2019. A report also noted that around 33 sellers could account for two-thirds of the total online sales on Amazon India.
