Urban Company Posts INR 243 Cr Profit In 9M FY25 On Deferred Tax Gain

Home and beauty services unicorn Urban Company reported a consolidated net profit of INR 242.6 Cr for the nine months ended December 31, 2024 (9M FY25) on account of a deferred tax gain of INR 215.5 Cr.

The IPO-bound ecommerce startup had posted a loss of INR 57.8 Cr in the year-ago period.

Urban Company would have reported a net profit of INR 27.1 Cr had it not been for the one-time deferred tax gain related to past tax losses and temporary differences.

Revenue from operations jumped 41% to INR 846 Cr during the period under review from INR 600.9 Cr in 9M FY24, aided by growth in its annual transacting consumer base and net transaction value (NTV). 

NTV from services is the monetary value paid by consumers towards services availed on the Urban Company platform (gross of taxes, net of discounts and cancellations). This metric jumped over 28% to INR 2,459.8 Cr in 9M FY25 from INR 1,915.1 Cr in the year-ago period.

Annual transacting users, or unique consumers who availed the company’s services in the trailing 12 months prior to the reporting period, rose 10% to 6.5 Mn in 9M FY25 from 5.6 Mn in 9M FY24.

Founded in 2014 by Abhiraj Singh Bhal, Varun Khaitan and Raghav Chandra, Urban Company provides a tech-enabled, full-stack online marketplace platform that enables users to hire professionals for household services. 

Yesterday, Urban Company filed its draft red herring prospectus (DRHP) with SEBI to raise INR 1,900 Cr through an initial public offering (IPO). The IPO will comprise a fresh issue of shares worth INR 429 Cr and an offer-for-sale component of INR 1,471 Cr.

Out of the total proceeds, Urban Company has earmarked INR 190 Cr for setting up a new technology and cloud infrastructure, INR 70 Cr for lease payments for office spaces, INR 80 Cr for marketing activities and the remaining funds for general corporate purposes.

Urban Company’s OFS will see existing investors Tiger Global, Accel India, Elevation Capital, Bessemer India Capital Holdings II Ltd, and VYC11 Limited offload shares.

Revenue Breakdown

Urban Company primarily generates revenue through platform services, the sale of products to service professionals and the sale of water purifiers and electronic door locks launched under the brand name, Native.

During 9M FY25, Urban Company scaled new businesses and made certain operational changes to better integrate its business and simplify its organisational structure, it said in its DRHP. Under the new structure, the startup gave a breakup of its earnings under three segments:

Indian Consumer Services: The IPO-bound startup raked in a revenue of INR 654 Cr from its hyperlocal home services in India in 9M FY25, up 24% from INR 527 Cr in the year-ago period.

Native: In 2023, Urban Company forayed into the RO water purifier segment with the launch of its water purifiers under the brand Native. It also sells electronic door locks under this brand. Revenue from these native-branded products zoomed nearly 7X to INR 76 Cr during 9M FY25 from INR 11 Cr in 9M FY24.

International Business: Besides India, Urban Company also has a presence in international markets such as Saudi Arabia, UAE and Singapore. The revenue from its international business zoomed 83% to INR 116.5 Cr in the reported period from INR 63.6 Cr in 9M FY24.

A Look At Urban Company’s Expenses

While Urban Company’s spending increased in 9M FY25, the revenue growth still outpaced the rise in expenditure. Overall, expenses went up 23% to INR 903 Cr during the period from INR 732.7 Cr in 9M FY24.

Procurement Cost: Procurement cost emerged as one of the biggest cost centres for the IPO-bound startup. The spending under this head shot up almost 80% to INR 148 Cr in 9M FY25 from INR 82.3 Cr in the corresponding period in the fiscal prior.

Employee Cost: This was the biggest expense head for Urban Company during the nine months ended March 31, 2025. The home services marketplace spent INR 258 Cr on employee benefits expenses during 9M FY25, up 2% from INR 253 Cr in the year-ago period.

Advertisement Expenses: This expense head rose a little over 7% to INR 131 Cr in 9M FY25 from INR 122 Cr in 9M FY24.

Ahead of its IPO, Urban Company cofounders sold shares worth nearly INR 780 Cr through multiple secondary transactions between September 2024 and February 2025. These shares were lapped up by investors, including Prosus, Think Investments, Dharana Capital, and Sriharsha Majety, cofounder of Swiggy.

It is pertinent to mention that Urban Company cofounders will not be participating in the OFS. They hold a cumulative 20% stake in the home services startup.

Last month, Urban Company also forayed into the quick commerce space with the launch of its 15-minute maid delivery service ‘Insta Help’.