ElasticRun’s FY24 Revenue Narrows To Half, Loss Declines 42%

Business-to-business (B2B) ecommerce solutions provider ElasticRun reported a 49% decline in its operating revenue, narrowing to INR 2,434.8 Cr in the financial year ended March 31, 2024 (FY24) compared to INR 4,738.0 Cr in the previous fiscal year.

The drop in the revenue coincided with a 42% reduction in the company’s net loss, which stood at INR 359.6 Cr in FY24 from INR 619.0 Cr in the previous fiscal year.

ElasticRun generates revenue through the sale of products and services. 

Revenue from the sale of products contributed INR 2,023.19 Cr in FY24, a sharp decline from INR 4,366.11 Cr in FY23. However, revenue from the sale of services increased by 10.3%, rising to INR 406.30 Cr from INR 368.34 Cr in the previous fiscal year.

Founded in 2016 by Sandeep Deshmukh, Saurabh Nigam and Shitiz Bansal, ElasticRun’s tech platform acts as an extended arm of FMCG companies’ direct distribution networks in rural areas and enables these businesses to reach kirana stores in the hinterland.

The startup generates revenue through its tech platform which acts as an extended arm of FMCG companies’ direct distribution networks in rural areas and enables these businesses to reach kirana stores in the hinterlands of the country. It also offers logistics and warehousing services to these small businesses.

ElasticRun generates the majority of its revenue by selling products. It procures products from FMCG brands and sells them directly to local retail stores in rural areas.

Earlier this year, brokerage firm HSBC marked down its valuation estimate for B2B ecommerce platform ElasticRun to $800 Mn. This was a nearly half cut from its valuation of $1.5 Bn at the time of a $300 Mn funding round in 2022. 

Despite reporting half of its revenue from FY23, the SoftBank-backed logistics startup narrowed its losses due to a sizeable expense cut and an increase in service sales. 

The Expense Breakup:

The Pune-based company’s total expenditure fell by 47% to INR 2,904.4 Cr in FY24 from INR 5,452.8 Cr in FY23. ElasticRun’s reduced expenses across categories helping improve its financial position.

Employee Benefit Expenses: Employee costs decreased by 28%, reaching INR 250.5 Cr in FY24 from INR 345.6 Cr in FY23. This reduction reflects the company’s efforts to streamline operations and improve efficiency.

Purchases of Stock-in-Trade: The largest cost component, purchases of stock-in-trade, witnessed a 56% decline, shrinking to INR 1,938.9 Cr in FY24 from INR 4,381.0 Cr in FY23.

Rent: Rent expenses also fell by 29%, amounting to INR 34.4 Cr in FY24 compared to INR 48.4 Cr in FY23.

Miscellaneous Expenses: Miscellaneous expenses, which include hired vehicle expenses, hired manpower expenses and other distribution expense, dropped by 19.24%, standing at INR 497.4 Cr in FY24 compared to INR 612.3 Cr in FY23.