PC: Medial
Top fintech company MobiKwik has displayed a stunning financial turnaround in the fiscal year ending March 2024. The company’s revenue stood at Rs 875 crore, a massive 62% jump from Rs 539 crore in FY23. This stellar growth has supported MobiKwik in gaining profitability, with a net profit of Rs 14 crore, recovering huge losses of Rs 84 crore reported in the previous fiscal year.
Other diversified income stream sources for the company include commissions on recharge, processing fees, interest income that comes from servicing loans, and revenue from payment gateways and technology. These diversified streams have been the drivers of the financial performance of MobiKwik in FY24.
The expansion of its loan book with strategic tie-ups with lending partners was among the major reasons for the success behind the success of MobiKwik. Due to the high expenses, lending operational cost flew three times high to Rs 270 crore from Rs 69 crore in FY23. Its payment gateway business grew by 18.4 percent, contributing Rs 201 crore to revenue during FY24.
Despite incurring higher operational costs, MobiKwik strictly controlled its spending. The total expenditure for FY24 increased by 36.4% to Rs 876 crore from Rs 642 crore in the last fiscal. This disciplined approach to cost management, combined with increased revenues, helped the company turn profitable.
The financial metrics of MobiKwik also narrate a healthy leap. ROCE and EBITDA margins surged and stood at 15.21% and 4.16% respectively. At a unit level, Mobikwik spent Rs 1 to earn a rupee in FY24, showcasing its operational efficiency.
MobiKwik had filed a draft red herring prospectus with the Securities and Exchange Board of India to raise close to Rs 700 crore through an initial public offering in January 2024. This is the second attempt that the firm has made to go public, as the first one was filed way back in July 2021, and it was equivalent to withdrawing due to bad market conditions. The new IPO plan raises less than half the previous target, which signals a more calculated and strategic approach.
To support its growth and IPO ambitions, MobiKwik earlier this year raised Rs. 50 crore ($6 million) in debt from BlackSoil Capital. The funding round just shows how confident the company is in its business model towards pursuing the IPO process.
More importantly, how MobiKwik charted its journey to profit in this hypercompetitive landscape riddled with the likes of Paytm is the big question. The key shots through which MobiKwik has positioned itself for potential growth and success in the fintech area are focusing on core offerings and maintaining a strong balance sheet. With an IPO up ahead, the company would be best placed to leverage its financial achievements and continue the upward trajectory in the market.
