IPO-bound MobiKwik in the black for FY24 with Rs 14 crore profit

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IPO-bound digital payments firm MobiKwik reported a 62 percent increase in operating revenue, reaching Rs 875 crore for the financial year ending March 2024.

In a significant turnaround, the company posted a profit after tax (PAT) of Rs 14.08 crore, compared to a loss of Rs 83.08 crore the previous year.

However, total expenses rose by 36.4 percent to Rs 876 crore, up from Rs 642 crore in FY23, driven by higher costs related to employee benefits, legal fees, advertising, and other overheads.

Co-founder and CFO Upasana Taku attributed the business growth to an expanding user base and increased revenue from the company’s financial services.

“We are delighted to have successfully transitioned from losses to full-year profitability. We’ve made great progress in advancing our products and expanding our reach to smaller towns and cities, where digital growth is currently surging,” Taku said.

In its second attempt to go public, MobiKwik refiled its draft red herring prospectus (DRHP) with SEBI in January, aiming to raise Rs 700 crore from its IPO. The firm had already reported profitability in the first half of FY24, with a PAT of Rs 9.5 crore and operating revenue of Rs 381 crore.

Also read: https://www.moneycontrol.com/technology/expect-full-fy24-to-be-profitable-as-well-says-mobikwik-co-founder-upasana-taku-article-12764928.html#google_vignette

Non-payment revenue 

Currently, 55 percent of MobiKwik's revenue comes from non-payment-related services, particularly the distribution of financial products like loans.

This includes small-ticket consumer loans or buy-now-pay-later (BNPL) options under its MobiKwik Zip product. Based on transaction history and data, users are offered loans ranging from Rs 1,000 to Rs 2 lakh.

In FY23, MobiKwik’s loan disbursals increased by 204 percent to Rs 4,102 crore, up from Rs 1,348 crore in FY22. The company reported around Rs 2,800 crore in disbursals during the first half of the current fiscal.

With the Reserve Bank of India cracking down on unsecured lending, MobiKwik has also been working on secured credit products. "We are developing a range of secured and unsecured lending products. Our aim is to expand our financial offerings, including credit, investment, and insurance," Taku said in a July interview with Moneycontrol.

According to the DRHP, 70 percent of MobiKwik’s loans are small—less than Rs 5,000—compared to the industry average of 68 percent for digital disbursals.

"We selectively offer loans to users based on their data. We start with smaller amounts, test their creditworthiness, and only then offer long-term credit. The same approach applies to merchant loans," Taku explained.

"We never aimed for rapid growth in sensitive areas like unsecured lending; we focus on a systematic approach with large lenders."

The company has also started offering investment options in digital gold, deposits, and direct mutual funds.