Zoomcar’s Loss More Than Halves To INR 74 Cr In FY22, Operating Revenue Up 1.2X YoY

Bengaluru-based car rental platform Zoomcar’s net loss narrowed nearly 54% to INR 74 Cr in the financial year 2021-22 (FY22) from INR 160 Cr in FY21.

Zoomcar, which recently signed a merger pact with blank check firm Innovative International Acquisition Corp to get listed on Nasdaq, saw its operating revenue rise 1.2X to INR 95 Cr in FY22 from INR 76.6 Cr in the previous fiscal year. 

As a platform that allows people to rent cars on a sharing basis, Zoomcar primarily generates revenue from short-term self-drive rentals and vehicle subscriptions. In FY22, the company launched a new platform called Zoomcar Host Services to help vehicle owners connect with users in temporary need of a vehicle on leasehold basis for their personal use. In case of Zoomcar Host Services, Zoomcar acts as an agent and hence, recognises revenue also on a net basis, it said in the financial filing with the Ministry of Corporate Affairs.

The startup managed to lower its loss during the reporting period despite a 1.2X rise in its total expenses to INR 359.1 Cr, largely led by its employee benefits expense. Employee costs accounted for 33% of the total expenses. In FY21, Zoomcar’s total expenses stood at INR 287.4 Cr. 

Employee benefit expenses rose 1.6X to INR 119 Cr in FY22 from INR 74.8 Cr in FY21. It spent INR 79.9 Cr on salaries and wages, which was a 31% rise year-on-year (YoY).

It also spent INR 18.5 Cr towards employee share-based payments during the year.

Meanwhile, Zoomcar saw a whopping 5.8X surge in its advertising and promotional expenses to INR 62.3 Cr in FY22 from INR 10.7 Cr in the prior fiscal year.

It must be noted that Zoomcar has been raising its promotional expenses amid several customer complaints pertaining to vehicle quality, theft of auto parts, arbitrary charges, as well as following a business downturn due to the pandemic.

While the company witnessed a significant surge in its advertising expenses, Zoomcar’s depreciation, depletion, and amortisation expenses halved to INR 23.7 Cr in FY22. Its finance cost also dropped to INR 26.1 Cr during the year from INR 52.8 Cr in FY21.

On the other hand, Zoomcar’s miscellaneous expenses zoomed over 15% to INR 44.7 Cr in FY22.

The startup was founded in 2013 by Greg Moran and David Back (who exited the startup in 2015). It has raised total funding of over $290 Mn till date and is backed by the likes of SternAegis Ventures, NKM Capital, and Sony Innovation Fund, among others.

As per reports, Zoomcar was looking to achieve profitability in 2022. Besides India, the company has presence in South East Asia, the Middle East and North Africa (MENA) region.