Zepto's revenue jumps 120% to Rs 4,454 crore in FY24, losses down by 2%

Aadit Palicha-led quick commerce unicorn Zepto has achieved a remarkable 120% jump in revenue for the financial year 2024 (FY24), rising from Rs 2,025 crore in FY23 to Rs 4,454 crore.

The Mumbai-based startup attributes its growth to a growing shift in consumer preferences, as more customers choose the convenience of 10-minute deliveries over traditional e-commerce platforms and local Kirana stores.

"Our accounting revenue has grown 120% year-on-year from Rs 2,025 Crores in FY23 to Rs 4,454 Crores in FY24. Even with 120% growth, our absolute losses came down year-on-year with PAT as a % of revenue improving from -63% in FY23 to -28% in FY24," Palicha wrote in a post on LinkedIn.

Rise in expenses

However, Zepto’s growth came at a cost. The startup's expenses ballooned by 72%, from Rs 3,350 crore in FY23 to Rs 5,747 crore in FY24, as it invested heavily in marketing, materials, and operations to attract customers and maintain its competitive edge.

A significant portion of these costs stemmed from procurement, which accounted for 60% of its total expenditure. Zepto spent Rs 3,481 crore on procurement in FY24, marking an 87% increase compared to the previous year.

Expenses related to employee benefits also surged to Rs 426 crore, which included Rs 74 crore in non-cash Employee Stock Ownership Plans (ESOPs).

The startup's investments in warehousing and logistics saw warehouse costs grow by 43% to Rs 493 crore, while delivery expenses climbed to Rs 580 crore.

Zepto also focused on advertising and technology, with marketing expenses rising to Rs 303 crore as part of its effort to enhance brand visibility. Technology spending increased by 66% to Rs 116 crore as the company worked to optimize its digital infrastructure.

Marginal decline in losses

Despite this significant rise in spending, Zepto managed to reduce its net losses by 2%, from Rs 1,271.84 crore in FY23 to Rs 1,248.64 crore in FY24.

"Despite being only 3 years old, we were able to successfully close a full statutory audit by a Big 4 firm with no financial qualifications and a clean CARO. This rare achievement for a young startup is the outcome of a governance-focused culture at Zepto and early decision-making that prioritized controllership excellence (like SAP FICO integration, automated revenue-to-cash reconciliation, set up of an H2H payment system etc)," Palicha wrote.

"We expect to continue this growth momentum with a clear path to PAT profitability in the near term," he added.

Rise in competition

With a 29% market share, Zepto is the second-largest player in India’s quick-commerce sector, trailing Zomato-owned Blinkit at 46% and ahead of Swiggy Instamart at 25%.

Notably, Zepto outperformed its competitors in revenue generation in FY24, with Blinkit and Swiggy Instamart reporting Rs 2,301 crore and Rs 1,100 crore, respectively.

Earlier this week, CEO Aadit Palicha announced that the company will be launching a dedicated app for Zepto Café next week.

Zepto Café, known for its curated beverage and snack offerings, has been growing rapidly.

According to Palicha, the company is now opening over 100 new Cafés each month and handling more than 30,000 daily orders.