Pharmeasy parent reports Rs 5,212 crore loss in FY23; revenue up by 16%

Mumbai-based API Holdings, the parent of PharmEasy, has reported a revenue of Rs 6,643.9 crore, marking a 16% increase from the previous fiscal year. 

Despite this growth, the company faced a substantial net loss of Rs 5,211.7 crore, over 31% higher than the previous year's loss.

Revenue sources and expenditure

The startup's revenue primarily comes from the sale of pharmaceutical and cosmetic products, contributing Rs 5,925.3 crore, and diagnostic and other services, adding Rs 701.2 crore. The total expenditure for FY23 was Rs 8,974 crore, a slight increase from the previous year.

Notably, procurement costs formed the largest expense, while employee benefit expenses and marketing costs were significantly reduced.

Debt and cost-cutting measures

PharmEasy, which shelved its IPO plans in 2022, faced a severe cash crunch but managed to raise Rs 3,500 crore in a rights issue. The company has been working to repay debt, including a high-cost loan from Goldman Sachs.

Notably, PharmEasy also adopted cost-cutting measures, including layoffs and reduced marketing expenses. The company's finance costs surged to Rs 665 crore in FY23, a significant increase from the previous year.

Competing with large players

Despite financial challenges, PharmEasy remains a key player in the online pharmacy market, competing with Tata 1mg, MediBuddy, and Practo. The company's gross merchandise value (GMV) stood at Rs 14,351 crore in FY23. However, PharmEasy has seen a shift in its market position, with Tata Digital-backed 1mg taking the lead in terms of GMV.

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