Pine Labs-backed Mosambee, which provides mobile point-of-sale solutions, has also done well. For the fiscal year ended March 2024, Mosambee has witnessed growth, garnering ₹240 crore revenue, up a strong 28% plus over the preceding fiscal year wherein Mosambee had made a revenue of ₹187 crore. Going alongside this impressive growth, profits have skyrocketed at an impressive rate of 87%.
PC:Mosambee
Revenue Composition and Performance
Mosambee is currently experiencing revenue growth mainly on its core services in payment solutions. The company generates 68% of its revenue from service rentals, transaction processing, and settlement; such revenue grew by 52.3% to ₹163 crore in FY24. This segment’s strong growth supports the fact that digital payments solutions are increasingly being adapted in India, especially after a growing preference for non-cash transactions.
Sales of point-of-sale (PoS) devices, on the other hand, were slightly down at 3.4% to ₹77 crore from ₹80 crore in FY23. This might indicate a change in direction towards strengthening service delivery rather than selling hardware as the market continues to evolve and consumers change their preferences.
Cost Management and Profitability
Despite the challenges in the hardware segment, Mosambee has successfully managed its costs, which contributed to its overall profit increase. The largest cost center for the company was the procurement of devices, accounting for 40% of total costs. This cost rose 15.3% to ₹83 crore in FY24 from ₹72 crore in FY23, indicating the growing expenses associated with maintaining a competitive edge in technology.
Employee benefits also increased modestly by 5.2% to ₹61 crore, including ₹8.7 crore in non-cash ESOP costs. Overall expenditure increased by 19.4% to ₹203 crore, largely on account of legal, technology, communication, and transaction services. However, controlled expenditure with strong revenue growth enabled Mosambee to report profits of ₹28 crore, a growth of 86.7% over the previous fiscal year.
Key Financial Metrics
Mosambee’s financial health continues to strengthen, as evident in improved return on capital employed and EBITDA margins that now stand at 31.25% and 23.33%, respectively. The expense-to-earning ratio of the company stood at ₹0.85 for FY24, thereby evidencing efficient management of operational costs relative to earnings.
Mosambee also reported total current assets of ₹296 crore, including cash and bank balances of ₹13 crore. This shows that the company is well placed in terms of its financials as it looks forward to future growth opportunities.
Strategic Developments and Future Outlook
In April 2022, Pine Labs acquired a majority stake in Mosambee, increasing its valuation over $100 million. Mosambee has now acquired more resources and support for expanding its market presence. It also made headlines earlier this year by securing a Series B funding round from the Rajasthan Venture Capital Fund (RVCF) and SIDBI Venture Capital Ltd, indicating the strong investor confidence in the business model and growth prospects.
With its focus on innovative payment solutions and a commitment to enhancing customer experiences, Mosambee is perfectly positioned to capitalize on the ongoing digital transformation in the payments landscape. As demand for seamless payment solutions continues to rise, Mosambee’s growth trajectory appears promising and will pave the way for further expansion and profitability in the coming years.
Lastly, the financial success of FY24 of Mosambee signifies that the company indeed exhibits a great degree of adaptability and resilience toward an increasingly dynamic market environment. Efficient management of cost and continuous strategic expansion of services must go a long way toward boosting future success.
