BillDesk Drops Expenses By 77% In FY18, Increases Net Profit By 15%

Mumbai-based digital payments company BillDesk reported a revenue of $132.6 Mn (INR 929 Cr) for the year ending March 31, 2018, aided by the rapid growth in India’s fintech sector. This is a 15% increase over the same period in FY17 when it reported revenue of $135.7 Mn (INR 950.6 Cr).

The company has managed to keep a check on its expenses, bringing them down by a whopping 77% to $25.2 Mn (INR 177 Cr) this fiscal as compared to $110.2 Mn (INR 772.2 Cr) in FY17.

According to company filings accessed via Tofler, a business intelligence platform for India, BillDesk’s net profit for 2018 was $20.9 Mn (INR 148 Cr), a 15% rise over the previous financial year, when it recorded a net profit of $19.6 Mn (INR 137.9 Cr).

In March this year, reports surfaced that BillDesk was in sale talks with PayU, American Express, and PayPal. However, the negotiations fell through as the companies could not agree on Billdesk’s valuation.

BillDesk is a payment processing platform that allows businesses and individuals to send and receive payments. Founded in 2000 by three former Arthur Andersen executives — M N Srinivasu, Ajay Kaushal and Karthik Ganapathy — BillDesk is one of the rare profitable internet companies in India.

The company is backed by TA Associates, General Atlantic, venture capital firm Clearstone Venture, and Singapore’s state-held investor Temasek Holdings.

Earlier, in November this year, BillDesk (IndiaIdeas Com Ltd) raised an undisclosed amount of funding from global payments processor Visa (link), which took a minority stake in the company at a valuation of  $1.5 Bn -$2 Bn.

BillDesk claims to processes payments worth almost $50 Bn every year and reportedly leads the charts for online bill payments. At present, it competes with players such as PayU, CCAvenue, Razorpay, Instamojo, among others.

By 2020, transactions in Indian fintech sector are expected to cross $73 Bn, growing at 22% CAGR, according to a KPMG report. The demonetisation effect is now fading away at a steady pace and digital payment companies are looking for new and larger revenue channels.

While BillDesk still maintains its early mover advantage in the payments space, the company is now staring at a market crowded with not just domestic and foreign companies with deep pockets, but also government-backed payments platforms.