Paytm-owned Nearbuy records lower net sales in FY18
Nearbuy India Pvt. Ltd, which operates an online marketplace for offline neighbourhood deals, managed to pare its losses and expenditure but also recorded lower net sales in the financial year 2017-18.
Gurugram-headquartered Nearbuy is owned by Vijay Shekhar Sharma-led Paytm.
As per the firm’s filings with the Ministry of Corporate Affairs, Nearbuy’s net losses fell to Rs 49.11 crore from Rs 75.90 crore in the year-ago period.
Total expenditure declined to Rs 82.15 crore from Rs 108 crore in the previous fiscal, mainly on account of a significant reduction in employee benefit expenses.
Nearbuy’s net sales fell to Rs 23.58 crore from Rs 28.21 crore in 2016-17.
In December 2017 -- the closing stages of the third quarter of the period under review -- Paytm had announced a merger between Nearbuy and rival Little to create the largest online deal discovery platform in India with a valuation of around $100 million and around 90% market share.
"The right way to look at it is the consolidated financials of Nearbuy India and Little Internet. That will show you a 19% increase in revenue and a 28% decline in losses," said Ankur Warikoo, co-founder and chief executive officer of Nearbuy. Little's financials were not accessible at the time of publishing this report.
The Nearbuy platform features hyperlocal offers in segments such as food and beverages, spa, salons, wellness and getaways.
Nearbuy, formerly Groupon India, was founded by Warikoo, Sumeet Kapur, Snehesh Mitra, Sachin Kapur, Ankur Sarawagi and Ravi Shankar.
The company changed its name to Nearbuy after buying a large chunk of its global parent Groupon Inc.’s stake, in a transaction that also saw Sequoia Capital pumping in money. It became an independent entity in August 2015. Sequoia had infused $20 million in the firm for an undisclosed stake. Groupon Inc. is now a minority shareholder in the Indian company.
In 2017, Paytm acquired Nearbuy to strengthen its hyperlocal play.
After the merger with Little, Warikoo was appointed the chief executive of the combined entity. At the time of the merger, Nearbuy was almost running out cash with less than a crore in reserve.
In an interaction with TechCircle last July, Warikoo said that the merged company was targeting sales of Rs 117.58 crore in 2019-20. He further said that Little-Nearbuy had already made considerable progress in terms of unit economics and was profitable on every transaction after accounting for marketing expenses.