PC: The Economic Times
Gurugram-based consumer electronics firm boAt is likely to report a flat revenue expansion for FY20 ended March 2024. However, the company has considerably reduced losses by a whopping 47% in the same period and would garner strategic attention for better operational efficiency as well as cost management.
According to a report by Entrackr, which has accessed an internal document sourced from the Registrar of Companies, or RoC, boAt’s audited revenue declined marginally by 5% at Rs 3,122 crore for FY24 against Rs 3,285 crore for the previous fiscal year. This again shows that the consumer electronics market is changing every day and how the competition is changing inside this market with boAt, the company.
Notably, boAt reported a positive EBITDA in FY24, signaling an important return to profitability and much better unit economics than that seen in the previous fiscal year. Sales are mainly reported from audio devices of the most diversified kind, including wired and wireless earphones, headphones, speakers, wired headphones, and soundbars. Additions from the sales of wearables and accessories form a sizeable chunk of the overall revenue stream for the company, reflective of the diversified product portfolio and market positioning that boAt enjoys.
The decline in revenues is not very significant, but cost management at the levels of boAt was quite effective. The firm brought down losses by 47% – a Rs 101 crore slump in FY23 translates to Rs 53.5 crore in FY24. Commitment towards achieving financial prudence and operating excellence shines through here.
BoAt’s audio business was stable in performance with a steady graph in the latter half of FY24. The wearables segment, however, remained an aggravation burden for the company as average selling prices plunged sharply and competition grew even sharper, leaving a margin pressure on it.
The internal document drawn to notice stated, “The audio business revenue continued to do well with a growth of 5% in FY24. Similarly, the EBITDA of the audio business grew at a commendable 9% in the same period.” The company remains optimistic about enhancing its EBITDA margins for the current fiscal by working on a number of projects such as warranty cost optimizations and reducing advertisement and promotion expense, among others.
Founded in 2015 by Aman Gupta and Sameer Mehta, total funding till date for boAt aggregates to $177 million from stalwarts like Qualcomm Ventures, Warburg Pincus, InnoVen Capital, Navi Technologies, and Fireside Ventures.
Indian wearables market also registered a sharp contraction in the June 2024 quarter, with shipments down 10% to 29.5 million units, researchers at IDC reported. This was partly attributed to over-supply and lack of innovation in the segment, which impacted leaders like Oppo, OnePlus, Fire-Boltt, Noise, and boAt, as their shipments declined by 9.8% year on year.
It has posed quite challenging opportunities for the boAt brand to navigate through the electronics sector with the changing dynamics of the market and competitive landscapes. So, innovation combined with operational efficiency and strategic partnerships should be the driving force for continued growth and profitability in the dynamic market environment.
