Tracxn’s Q1 Net Profit Halves QoQ To INR 69 Lakh, Revenue Slips 2.5%

Market intelligence startup Tracxn Technologies’ net profit nearly halved quarter-on-quarter (QoQ) to INR 0.69 Cr in the first quarter of financial year 2023-24 (FY24). 

The startup reported a profit of INR 1.36 Cr, excluding IPO expenses and deferred tax windfall of INR 23.26 Cr in Q4 FY23. 

Tracxn’s Q1 FY24 profit during the quarter also declined 18% from INR 0.84 Cr in Q1 FY23. 

Revenue from operations fell 2.5% to INR 19.82 Cr in Q1 FY24 from INR 20.34 Cr in the previous quarter. However, on a year-on-year (YoY) basis, it rose 8% from INR 18.4 Cr. 

The company said that revenue grew at a slower pace during the quarter but it would have ‘marginal impact on margins’, adding that it witnessed acceleration in deferred revenue growth in Q1 FY24. 

A major chunk of its revenue came from international clients during the quarter ended June 2023. They accounted for nearly two-thirds of the total revenue. The US, Singapore, Germany and the UK were the top contributors to the revenue. India contributed the remaining 33% to the startup’s topline. 

Tracxn’s EBITDA during the quarter declined to INR 0.02 Cr from INR 0.19 Cr in the year-ago period and INR 0.69 Cr in Q4 FY23. On similar lines, EBITDA margin contracted to 0.1% in Q1 FY24 from 1.01%% in Q1 FY23 and 3.42% in Q4 FY23. 

Meanwhile, total expenses rose nearly 9% to INR 19.85 Cr in the quarter under review from  INR 18.24 Cr in the corresponding quarter last year. However, the increase was marginal on a QoQ basis from INR 19.71 Cr. 

The startup said that the growth in expenses ‘eased’ in Q1 FY24 as it reduced the headcount QoQ. However, employee benefit expenses still accounted for more than 87% of the total spending during the quarter under review. Non-cash ESOP expenses stood at INR 0.9 Cr during the quarter.

The company’s headcount declined to 825 at the end of Q1 FY24 from 892 at the end of Q4 FY23, which it attributed to optimisation of workforce due to automation and efficiency initiatives.

The startup’s free cash flow declined to INR 0.6 Cr, while its total cash and cash equivalents stood at INR 61.9 Cr at the end of Q1 FY24. 

Meanwhile, Tracxn said that its key operational metrics continued to see an upswing during the quarter. The number of customer accounts jumped 9% YoY to 1,236, while the number of users on the platform jumped 6% on a yearly basis to 3,467. 

The startup claimed that its contract price continued to see an uptick, rising 13% to INR 21.4 Cr in Q1 FY24 from INR 18.9 Cr in Q1 FY23. It claims to have so far profiled 2.3 Mn entities on its platform. 

Speaking about its growth initiatives, the company, in an investor presentation, said, “… we have been investing across various growth initiatives. These span across the go-to-market funnel of marketing, sales and account expansion… We believe as the markets open up further, we should see more acceleration than previously in new customer acquisition as well as customer expansion.”

Founded in 2012, Tracxn is the brainchild of Neha Singh and Abhishek Goyal. The market intelligence platform offers a SaaS-based tool that tracks company financials and captables of entities. It has customers in over 50 countries.

The results were declared after  market hours on Tuesday. The startup’s shares closed 1.44% higher at INR 86.83 on the BSE today.