SUGAR Cosmetics’ FY23 Sales Jump 89% To INR 420 Cr, Incurs Loss Of INR 76 Cr

Vineeta Singh-led beauty ecommerce brand Sugar Cosmetics’ sales inched closer to INR 500 Cr mark in the financial year ending on March 31, 2023. The startup reported an operating revenue of INR 420.2 Cr in FY23, an 89% increase from INR 221.8 Cr it had generated in the previous fiscal year.

It is pertinent to mention that SUGAR Cosmetics earns its revenue by selling cosmetics and beauty products. 

Founded by Singh and Kaushik Mukherjee in 2015,  SUGAR Cosmetics started its journey as a D2C brand, with an online platform. However, later, it pivoted to an omnichannel model and claims to have over 40,000 retail outlets across more than 550 cities in India. The platform markets products in the lips, eyes, face, nails and skin categories.

Including other income, the startup’s total revenue was INR 428.3 Cr, a 91.3% from INR 223.8 Cr it had generated in the previous fiscal year.

With the rise in revenue, the startup has managed to cap its losses. In FY23, the startup incurred a net loss of INR 76.2 Cr, a marginal increase from INR 75.9 Cr it had incurred in the previous fiscal.

Where Did SUGAR Cosmetics Spend?

The Shark Tank judge led the startup’s total expenditure increase by 69% to INR 505.5 Cr in FY23 as against INR 300 Cr in FY22.

Advertising Expenses: SUGAR’s biggest expenditure was on the marketing. To create a wider brand awareness, the startup spent INR 162.5 Cr, almost 40% of its revenue. Its FY23’s advertising expenses were 67% higher than INR 97.5 Cr it spent in the previous fiscal year.

Procurement Cost: In order to stock up its shelves, SUGAR spent INR 113.9 Cr in the year under review, a 72% increase from INR 66.3 Cr it spent in FY22. 

Employee Benefit Expenses: In FY23, SUGAR spent INR 60.8 Cr for employee salaries and other welfare expenses. This was a 71% increase from INR 35.5 Cr it spent in FY22. As per Linkedin, the startup has an employee headcount of around 1,000.

The startup improved its EBITDA margin to -14.55% in FY23 from -30.48% in FY22.

SUGAR Cosmetics raised around $85 Mn in multiple funding rounds and counts Elevation Capital, A91 Partners and India Quotient, among its investors. 

The startup, which was last valued at around $500 Mn, was reportedly in talks to raise another $100 Mn at around $700 Mn valuation. SUGAR closely competes against the likes of WoW Skin, which has seen its sales plummet in FY23, Plum, MamaEarth and Nykaa, among others.