Digital learning solutions provider LEAD has announced a significant achievement for the fiscal year ending March 2024, having crossed the ₹350 crore revenue mark with reported revenues of ₹351 crore. The company said this is with a strong year-on-year growth of 28.6% from ₹273 crore in FY23. Along with the revenue growth, LEAD has taken great strides to improve its financial health by reducing losses by 56%. This marks the effectiveness of the company’s operational strategies and cost management efforts.
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The Mumbai-based company focuses on offering a complete range of educational resources to schools, including books, workbooks, curricula, smart classes, teacher training, and more. The company currently collaborates with over 8,000 schools across more than 400 cities in India. A large chunk of LEAD’s revenue—79%, which translates to ₹276 crore—was generated from product sales, which grew by 35% over the year. The remaining ₹75 crore was earned from platform services.
In addition to its operating income, LEAD earned ₹19 crore from non-operational activities, which pushed its total income to ₹370 crore for FY24. This diversified income stream is a reflection of the company’s strategic focus on enhancing its product offerings and expanding its service capabilities.
Amongst all of these aspects of financial performance, one of the most outstanding performances LEAD has achieved is to reduce its employee benefit cost by 39% at ₹174 crores. The reduction did make employee benefits the biggest item in the expense list and constituted 34% of the total expenses.
Meanwhile, across several categories, LEAD undertook various cost-cutting measures through its efforts at reducing advertising, legal fees, and donations, all of which brought the overall total expenses down by 17% to ₹513 crore.
This disciplined approach to cost management has been a key in assisting LEAD reduce its net losses to the tune of 55.6% to ₹143 crore in FY24. The return on capital employed (ROCE) and EBITDA margins for the company have stood at -46.9% and -15.68% and have indicated a path toward improvement as the operations scale.
The good news for the company came in the form of a promising announcement: LEAD achieved EBITDA positivity in Q1 FY25. This marks an important turning point for the company on its way to sustainable profitability. So far, LEAD has raised over $180 million in funding, including the large investment of $100 million by WestBridge Capital in 2022, which had catapulted the firm to unicorn status.
The largest external stakeholder of LEAD currently is WestBridge Capital with 27.58% of the company, followed by Elevar Equity. The co-founders Sumeet Mehta and Smita Deorah collectively own 32.7% of the company. This indicates that they are pretty confident in the vision and strategy for the company.
Achieving ₹350 crore in revenue with massive loss-cutting capability in the process is the mark of a good business model and operational efficiency for LEAD. As the company continues to expand its educational resources and services, the recent financial performance of the company seems quite strong and well-positioned for the future.
The company’s focus on innovation and strategic partnerships will ensure that LEAD is well-positioned to adapt to the changing landscape of digital education in India. This success not only showcases LEAD’s commitment to enhancing the quality of education but also sets a precedent for other players in the edtech sector.
