InsuranceDekho has seen a remarkable turnaround in its financial performance for the fiscal year ending March 2024, with revenues skyrocketing 7.7 times and a shift from losses to profits.
A Monumental Growth in Revenue
InsuranceDekho, a prominent player in the insurance comparison space, reported an impressive surge in its revenue from operations, which jumped to Rs 743.6 crore in FY24 from Rs 96.5 crore in FY23. This dramatic rise in revenue marks a significant milestone for the Gurugram-based company, which has made impressive strides since its inception.
The company offers a wide range of insurance products including motor, health, travel, and pet insurance, along with investment plans such as ULIPs, child, fixed deposits, and retirement plans. Among its offerings, insurance brokerage proved to be the largest revenue contributor, accounting for Rs 726.61 crore—about 97.7% of the total operating revenue. Ancillary services, including various forms of support and additional product offerings, brought in Rs 17 crore.
Profit Turnaround: From Loss to Rs 86 Crore Profit
After a challenging fiscal year in FY23, when the company recorded a loss of Rs 51 crore, InsuranceDekho achieved a dramatic turnaround, posting a profit of Rs 86 crore in FY24. This profit leap is particularly remarkable given the company’s hefty expansion in operational scale. The company’s total income for FY24 reached Rs 785 crore, boosted by Rs 41.3 crore from non-operating sources such as software sales and interest income.
This success is not just a result of strong revenue growth but also improved cost management. Despite substantial increases in expenses, the company’s operational efficiency, as measured by Return on Capital Employed (ROCE) and EBITDA margin, improved significantly, reaching 16.5% and 11.73%, respectively.
Expanding Costs Amidst Growing Revenue
While revenue grew at a rapid pace, InsuranceDekho also faced substantial increases in its costs. Notably, point-of-sales charges surged by 36 times to Rs 301 crore from Rs 8.3 crore the previous year, representing 43% of the company’s total expenses. Employee benefit expenses also rose by 21.7%, totaling Rs 130.26 crore. Manpower management costs saw a staggering 53X increase to Rs 35 crore.
In total, the company’s expenses for FY24 stood at Rs 699.21 crore, a 4.6-fold increase compared to the previous fiscal year. This sharp increase in expenses reflects the company’s aggressive expansion strategy, including heavy investments in scaling up its operations and marketing efforts.
Strong Financial Position and Strategic Moves
InsuranceDekho’s financial health remains strong, with a Cash and Bank balance of Rs 37.7 crore and current assets amounting to Rs 795.32 crore at the close of FY24. These figures underscore the company’s robust liquidity and readiness for further growth.
In October 2023, the company raised $60 million in a Series B funding round led by Mitsubishi UFJ Financial Group, bolstering its financial position and giving it the resources needed to expand further. InsuranceDekho is also reportedly in talks to merge with Renewbuy, a move aimed at strengthening its market presence and competing more aggressively with the likes of PolicyBazaar, the industry leader.
Industry Context and Future Outlook
The Indian insurance aggregation market has become increasingly competitive, with players like PolicyBazaar leading the charge. However, InsuranceDekho’s impressive growth in FY24 puts it in a strong position to challenge the established players. With the continued rise in demand for insurance products, especially in the digital space, InsuranceDekho’s future prospects look promising.
Analysts believe that if the company continues to maintain its growth trajectory, an IPO could be on the cards in the near future. This would position the company as a formidable competitor in a market that is expected to consolidate into a few dominant players.
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