IPO-Bound Ullu’s Profit Drops 16% To INR 13 Cr In FY24

IPO-bound OTT streaming platform Ullu Digital’s profit after tax (PAT) declined 16% to INR 12.68 Cr in the fiscal year 2023-24 (FY24) from INR 15.14 Cr in the previous fiscal.

The decline in profit came despite an increase in its top line. Ullu’s revenue from operations rose 7% to INR 99.67 Cr during the year under review from INR 93.15 Cr in the previous fiscal year. 

Including other income of INR 51.51 Lakh, total revenue crossed the INR 100 Cr mark. 

The OTT platform filed its draft red herring prospectus (DRHP) in February 2024 for a listing on the BSE SME platform. As per the draft papers, it is looking to raise INR 135 Cr to INR 150 Cr through its initial public offering (IPO), which will solely consist of a fresh issue of 62.63 Lakh shares.

However, after filing the DRHP, the OTT platform found itself caught in regulatory issues due to its erotic content. In February last year, the National Commission for Protection of Child Rights (NCPCR) urged the electronics and IT ministry (MeitY) to take action against the OTT platform.

In a letter to the ministry on February 27, NCPCR chairperson Priyank Kanoongo said that the ‘Ullu’ application, available on both the Play Store and the iOS, contains “extremely obscene and objectionable” content which is accessible even to children.

This triggered an investigation conducted jointly by SEBI, corporate affairs ministry, and MeitY. 

The controversy resulted in delays in Ullu’s IPO plans. Last month, its founder and CEO Vibhu Agarwal told exchange4media that the company is now expecting to go public by March 2025.

Where Did Ullu Spend?

The OTT platform’s total expenses surged 15% to INR 83.49 Cr from INR 72.33 Cr in the previous fiscal year.

Employee Benefit Expenses: Ullu’s spending on its employees rose 41% to INR 11.89 Cr from INR 8.43 Cr in the previous fiscal year.

Purchase Of Stock-in Trade: The OTT platform spent INR 27.33 Cr under the head, a decline of 13% from INR 31.54 Cr in FY23. 

Advertising Expenses: The startup cut its ad costs by 26% to INR 14.96 Cr from INR 20.14 Cr in FY23. 

Ullu competes with the likes of Amazon’s MX Player, ALTBalaji, among others, in the crowded Indian OTT market.