Quikr shrank FY17 losses but burnt over Rs 6 for every Re 1 in net revenue

Quikr shrank FY17 losses but burnt over Rs 6 for every Re 1 in net revenue
19 May, 2018

Bengaluru-based online classifieds firm Quikr India Pvt. Ltd has reported a sharply narrower net loss for the year through March 2017, though it continued to spend far more money than it makes in revenue.

Net loss for 2016-17 shrank to Rs 305 crore from Rs 534 crore the year before, Quikr's latest filing with the Registrar of Companies shows.

The development is significant for Quikr and shows the company is on the mend after burning cash heavily in previous years. The recovery began in 2015-16 when its net loss expanded at a slower pace after doubling in each of the previous three years.

The company started tightening its belt in 2015-16, when its total expenses rose 26% to Rs about 629 crore after more than doubling in each of the previous three years.

Total expenses for 2016-17 dropped by a third to Rs 406.22 crore, the latest filing shows.

Net revenue, or income from its core operations, rose 55% to Rs 64 crore for 2016-17 from Rs 41.24 crore in 2015-16. Total revenue came in at Rs 102.9 crore after adding income from non-operational activities such as investments in bonds and mutual funds.

This means the company burnt more than Rs 6 for every rupee it made in net revenue for the year.

The company had filed its initial numbers for 2016-17 in January and has now submitted its detailed financials.

Despite the increase in revenue, Quikr remains India’s second-smallest unicorn by revenue, only ahead of messaging app Hike – which has no revenue to show. A unicorn is a company valued at more than $1 billion.

A Quikr spokesperson had said in January that the numbers reflected the company’s diversification after starting out as a “conventional playbook-based classifieds platform”. The spokesperson  had also said the rise in revenue showed that the company's strategy to establish different verticals such as auto, real estate and home services was working well and that growth was well distributed across the verticals.

Quikr has thus far raised around $350 million. Its investors include marquee names such as Tiger Global, Kinnevik AB, eBay, Omidyar Network and Warburg Pincus.

The company has adopted an aggressive strategy of buying small digital startups to expand into verticals such as real estate, jobs, automobiles and services.

Its acquisitions include the purchase of the real estate brokerage firm HDFC Realty Ltd and HDFC Developers Ltd, which runs an online classifieds platform, in a stock deal worth Rs 357 crore. As part of the deal, mortgage lender HDFC Ltd picked up a stake in Quikr.

Last June, Quikr had acquired blue-collar jobs listing company Babajob Services Pvt. Ltd in a mostly-stock deal. Babajob was its eleventh acquisition in all and second in the hiring segment after Hiree.

Quikr was founded in 2008 by Pranay Chulet and Jiby Thomas. It had previously purchased CommonFloor and Grabhouse in the real estate segment, apart from a clutch of small startups in the services space.

The company struck at least seven deals in 2016 and two in 2015, according to VCCEdge, the data research arm of VCCircle.

Quikr competes with OLX – backed by South African internet conglomerate Naspers – in the online classifieds segment. Market leaders 99acres.com, Magicbricks.com are its competitors in the online real estate brokerage and property listing segments. Other players include Housing.com and News Corp-backed PropTiger, which decided to merge a year ago. News Corp is also the parent of VCCircle.