The quick-service restaurant (QSR) chain Wow! Momo posted a revenue of Rs 470 crore in FY24, marking a 14% growth compared to the previous year. However, this is a sharp deceleration from the 88% year-on-year surge recorded in FY23, indicating a slowdown. Despite the softer growth, the Tiger Global-backed firm managed to keep its losses stable, ending the fiscal year with a Rs 114 crore loss.
Revenue Growth Slows, But Core Business Holds Strong
Wow! Momo, founded in 2008 by Sagar Daryani and Binod Homagai, operates three brands—Wow Momo, Wow China, and Wow Chicken. The company has expanded to 630 outlets across 35 cities with a workforce of 6,000 employees.
Revenue from food and beverage sales remained the backbone of the business, contributing 97% of the total operating income. This segment grew 11.5% to Rs 456 crore, while the frozen momo sales made up the remaining portion. Additionally, the company earned Rs 9 crore in interest on deposits, taking the total revenue to Rs 479 crore for FY24.
Despite these gains, the pace of revenue growth has noticeably slowed. The previous fiscal year saw an 88% jump, but FY24’s 14% growth suggests a more tempered trajectory for the QSR chain moving forward.
Cost Pressures and Expense Breakdown
Managing costs while expanding operations continues to be a challenge for Wow! Momo. Material procurement costs accounted for 26.6% of total expenditure, rising 15.3% year-on-year to Rs 158 crore. However, the company managed to cut down on employee benefit expenses, which fell 27.7% to Rs 120 crore.
Other costs—including power, rent, advertising, commissions, and finance costs—pushed overall expenditure up by 11.9% to Rs 593 crore. The company’s expense-to-revenue ratio stood at Rs 1.26, suggesting high operational costs in relation to earnings.
A look at key financial metrics:
| Metric | FY24 | FY23 |
|---|---|---|
| Operating Revenue | Rs 470 Cr | Rs 413 Cr |
| Total Revenue | Rs 479 Cr | Rs 422 Cr |
| Total Expenditure | Rs 593 Cr | Rs 530 Cr |
| Net Loss | Rs 114 Cr | Rs 114 Cr |
| ROCE | -8.33% | – |
| EBITDA Margin | 7.93% | – |
Stable Losses and Strong Cash Position
Despite higher costs, Wow! Momo has managed to keep losses flat at Rs 114 crore in FY24. This stability, combined with a strong cash position, provides the company some breathing room.
By the end of the fiscal year, Wow! Momo’s total current assets stood at Rs 250 crore, including Rs 175 crore in cash and bank balances. This liquidity could help the company sustain operations and invest in further expansion.
Investor Confidence and Future Outlook
Wow! Momo has raised over Rs 600 crore to date, including a $42 million (Rs 350 crore) Series D round led by Malaysia’s sovereign wealth fund, Khazanah Nasional Berhad. Tiger Global remains the largest external stakeholder, followed by Treeline Investment.
The company’s ability to maintain investor confidence despite slowing revenue growth and persistent losses suggests a long-term belief in its expansion strategy. However, with the QSR space becoming increasingly competitive, it remains to be seen how Wow! Momo will balance scaling operations with profitability.
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