LEAP India’s FY25 Profit Remains Flat Despite 28% Revenue Growth

IPO-bound LEAP India’s net profit remained almost flat at INR 37.5 Cr in the year ended March 2025 (FY25) as against INR 37.1 Cr in FY24 despite a strong growth in revenue.

The company’s operating revenue zoomed 27.8% to INR 466.4 Cr during the year under review from INR 364.9 Cr in FY24. 

The company largely earns from the sale of services, which amounted to INR 446.5 Cr during the period under review. Of this, it earned INR 294.8 Cr from pallets and INR 88.5 Cr by providing material handling equipment. It earned INR 11.9 Cr from sale of products, with pallets bringing in INR 10.8 Cr. 

Including other income of INR 18.6 Cr, LEAP India’s total revenue stood at INR 485 Cr in FY25. 

Meanwhile, the rise in expenses outpaced the growth in revenue. Total expenses rose 33.1% to INR 432.9 Cr in FY25 from INR 325.2 Cr in the previous fiscal year.

The company’s EBITDA rose 30.4% YoY to INR 273.6 Cr, while EBITDA margin expanded to 59%.

Leap India outlined these numbers in its DRHP filed with SEBI last week. The company’s INR 2,400 Cr IPO will comprise a fresh issue of up to INR 400 Cr and an offer for sale (OFS) of up to INR 2,000 Cr. 

As part of the OFS component, the company’s promoter, KKR-owned Vertical Holdings II, intends to divest shares worth up to INR 1,998.6 Cr, while promoter group entity KIA EBT Scheme 3 will sell shares worth up to INR 1.38 Cr. 

Founded in 2013, LEAP India claims to be the country’s largest on-demand asset pooling provider for supply chain management. It offers pallets, containers, and other material handling equipment.

Understanding The Business Model Of LEAP India

LEAP India’s platform lets companies rent the equipment they need to move goods, instead of owning it themselves. This includes pallets, containers of different types, and machines like forklifts and reach trucks. 

However, the business is heavily reliant on pallet pooling, which brings in the highest revenue. Pallet pooling generated a revenue of INR 316.7 Cr in FY25, accounting for 67.9% of total revenue. 

Once a customer uses an item, it goes back into LEAP India’s system for checks and is repaired, if needed, before being rented out again. At the end of May 2025, LEAP India managed about 13.6 Mn assets and operated 30 fulfilment centres across India. 

LEAP India has more than 900 customers across sectors like consumer goods, beverages, pharmaceuticals, ecommerce, electronics, and automotive. In practice, it serves any business that needs to move products efficiently through warehouses and distribution networks.

It generates revenue by charging service fees for the assets it rents. Customers pay for using pallets, containers, and other equipment either on a daily basis if the items stay at their site for long periods, or on a per-movement basis when the assets move through supply chain routes, such as from a supplier to a manufacturer and then to a retailer. When assets are first issued to a customer, a one-time allotment fee is also charged.

The company also earns from service charges, especially when items are lost or damaged and cannot be returned or reused. Additional services such as repair, maintenance, transport of assets between sites, and digital support are billed separately but are often linked to the main rental programme.

LEAP India also runs a material handling equipment pooling business under its ‘TARON’ brand, through which it rents or leases machines like forklifts. These contracts are usually tenure-based, with payments linked to actual usage, and come bundled with service packages. 

Revenue growth mainly depends on how well assets are used and how often they circulate. Higher utilisation and faster turnaround increase earnings from each item. In FY25, utilisation was at about 88% for pallets, 69% for containers, and 82% for equipment. 

Dissecting The Expenses

Depreciation, Amortisation & Impairment Expenses: This was the biggest expense for the company, rising 36% to INR 153.7 Cr in FY25 from INR 112.6 Cr in the previous fiscal. 

Employee Benefit Expenses: The company’s employee cost stood at INR 89.6 Cr, up 43.6% from INR 62.4 Cr in FY24. 

Repair & Maintenance: It spent INR 26.7 Cr under this head, a decline of 9.5% from INR 29.5 Cr in the previous year.

Marketing: Marketing expenses declined slightly to INR 2.2 Cr in FY25 from INR 2.5 Cr in FY24.

Packing, Freight & Transportation: Expenses under this head grew 41% to INR 38.5 Cr during the period under review from INR 27.3 Cr in FY24.