Healthkart Witnesses Remarkable Revenue Surge, Soaring 2.7 Times to Rs 832 Crore in FY23
Three points you will get to know in this article:
- Healthkart’s revenue surged 2.7 times to Rs 832 crore in FY23, highlighting strategic growth and positive market reception.
- The company maintains a diverse product portfolio, reaching consumers through various channels, and has achieved significant market shares with its brands.
- Despite escalating costs, Healthkart adeptly managed financial setbacks and showed improvements in key financial metrics and profitability.
Over the FY18-FY21 span, Healthkart experienced a plateau in its growth trajectory, yet over the last couple of years, the company has successfully reignited its upward momentum. Remarkably, the nutritional powerhouse saw its revenue skyrocket by 2.7 times, reaching Rs 832 crore in FY23, a significant leap from Rs 307 crore in FY21, showcasing a remarkable enhancement in its unit economics.
According to data extracted from the Registrar of Companies, Healthkart’s revenue from operations exhibited a robust growth of 60.45%, climbing to Rs 832 crore in FY23 from Rs 491 crore in FY22. This signals a commendable financial upswing for the company, reflecting its strategic moves and positive market reception.
Product Portfolio and Distribution Channels
Healthkart oversees a portfolio of eight nutritional brands, including MuscleBlaze, The Protein Zone, TrueBasics, HKVitals, bGreen, Nouriza, and Gritzo. These products reach consumers through various channels such as the company’s website, application, third-party e-commerce platforms, and pharmacies. Adding to its accessibility, Healthkart maintains a network of over 140 physical stores scattered across India.
Market Share and Revenue Streams
As of December last year, Healthkart proudly announced that MuscleBlaze had secured a noteworthy 25% share of India’s sports nutrition market, while HKVitals had a commendable 20% share in the online health supplement market.
An interesting facet of Healthkart’s revenue stream in the fiscal year 2023 was its reliance on the sale of in-house nutritional products and the collection of marketplace fees for facilitating the sale of goods from other vendors on its platform. This dual approach served as the exclusive source of income for the company during that fiscal period.
For those who may not be familiar, HealthKart took a significant step in 2015 by separating its generic drug search business, HealthkartPlus. The separated entity underwent a rebranding and emerged as Img, currently operating under the banner of Tata Img Technologies Private Limited.
On the financial front, the procurement of supplements emerged as the primary cost driver, constituting 46% of the overall expenditure. This particular cost witnessed a substantial increase of 79.2%, soaring from Rs 240 crore in FY22 to Rs 430 crore in FY23.
Featuring eminent personalities such as Shubman Gill, Vidyut Jamwal, and Anoop Thakur as its esteemed brand ambassadors, the company experienced a noteworthy surge in advertising expenses. The advertising cost recorded a remarkable hike of 56.2%, reaching Rs 189 crore in the past fiscal year.
Further contributing to the total expenditure were various factors, including employee benefits, transportation, commission to agents, information technology, legal-professional services, and other overheads. This diverse array of expenses collectively drove the total expenditure up by 60.94%, amounting to Rs 927 crore in FY23.
The effective deployment of a reasonable scale proved instrumental in Healthkart’s adept handling of financial setbacks, witnessing a marginal uptick of 10% to reach Rs 76 crore in FY23, compared to Rs 69 crore in FY22. Notably, there were noteworthy enhancements in both its Return on Capital Employed (ROCE) and Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), demonstrating improvements to -22% and -16%, respectively. Delving into the specifics, the company expended Rs 1.11 to generate a single rupee during FY23.
In conclusion, Healthkart, after a period of stagnant growth, has achieved a remarkable resurgence, with its revenue soaring 2.7 times to Rs 832 crore in FY23. This success can be attributed to its diverse portfolio of nutritional products, strong market presence, and effective revenue streams from in-house products and marketplace fees. However, the company faced substantial cost increases, particularly in supplement procurement and advertising expenses, leading to a significant rise in total expenditure. Despite these challenges, Healthkart managed financial setbacks adeptly, showcasing improvements in key financial metrics and the ability to generate a profit.
