SoftBank-backed online grocery platform Grofers, which plans to go public by the end of 2021, saw its revenues more than double to USD 24.2 million in the financial year ended March 2020, while its net losses rose by 42% to USD 87.4 million.
The Gurugram-based startup’s expenses were up by 53% to USD 111.6 million in FY20 as compared to USD 72.9 million a year earlier, local media Livemint said, citing documents sourced from business information platform Tofler.
Founded in November 2013 by Albinder Dhindsa and Saurabh Kumar, the company has been growing steadily despite seeing a fair share of pivots and struggles in a bid to gain and retain market share. Currently, the company has partnered with 12,000 offline stores to fulfill customer orders. Since the onset of pandemic last year, Grofers has added 5,000 new stores as internet users in smaller cities grew multi-folds during the COVID-19-induced lockdown.
According to a recent report by Bengaluru-based consulting firm RedSeer, there were 154 million households that transacted online in India in 2020, and this number is poised to grow to 233 million by 2025.
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Grofers also added 10,000 sq. ft of warehousing space during the year, which allows the company make express deliveries in two hours, Dhindsa told Livemint.
“We opened 23 new facilities during lockdown last year and made a significant amount of investment to meet the higher demand for essentials. We also looked at acquiring more local space in towns and cities and ramped up our partnership with local store partners,” Dhindsa said.
Grofers, which is now present in 38 cities, said its sales volume grew 80% in 2020. The e-grocer’s aim to achieve overall profitability by 2020 has now shifted to 2021, the report said. However, it is still pushing ahead with its plan to launch an initial public offering (IPO) by this year-end, it added.
Its bigger rival BigBasket saw its revenue grow to USD 523.6 million, up 36.2% as compared to FY19. The company’s losses also swelled 26% to USD 97.2 million in the same period.
Apart from Grofer and BigBasket, the online grocery market is crowded with deep pocketed players such as Amazon, Walmart-owned Flipkart, and Reliance’s JioMart. According to the RedSeer report quoted above, e-grocery is projected to touch USD 24 billion by 2025, 3% of the total grocery market of USD 850 billion. Before the pandemic hit, RedSeer was expecting it to grow to USD 3 billion by 2020 from USD 2019.