Flipkart-owned Jade Eservices, which owns online fashion apparel marketplace Jabong, has narrowed its losses for the financial year ended Mar 31 on higher revenues and curtailed spending.
The company reported a consolidated net loss of Rs 179 compared to Rs 188 crore a year ago, mainly its revenues increased 19% to Rs 204 crore.
Jabong’s total expenditure too fell 6% to Rs 417 crore. The expenditure was lower as the company cut its branding and promotional expenses to Rs 128 crore from Rs 149 crore, logistics and incidental costs to Rs 90 crore from Rs 145 crore and IT costs to Rs 24 crore from Rs 30 crore.
However, the Jabong’s employee costs rose to Rs 64 crore from Rs 53 crore while finance costs rose to Rs 55 crore from Rs 25 crore.
In 2017, Jade Eservices had transferred its B2B business on a slump sale basis to Myntra Jabong India for Rs 268 crore, as per regulatory filings. In FY18 the company also took a one-time hit of Rs 75 crore on account of the transfer.
While Flipkart had acquired Myntra in 2014, the latter acquired Jabong from Rocket Internet-backed Global Fashion Group for $70 million in 2016.
In May 2018, US-based retailer Walmart bought 77% stake in Flipkart for $16 billion.
In November 2018, Flipkart had announced plans to merge the operations of Myntra and Jabong, which also led to lay-off of Jabong’s 200 employees from a total of 700.
In November 2019, Walmart CEO Brett Bigs said that the company took a $290 million hit on account of merger of operations of Myntra and Jabong and writing off the brand value of the latter.