Home interior startup HomeLane reported a widened consolidated net loss of INR 173.5 Cr in the financial year 2022-23 (FY23), up from INR 150.8 Cr in the previous fiscal year, hurt by a significant jump in employee benefit expenses.
HomeLane’s bottom line was adversely affected despite a 1.3X rise in operating revenue to INR 573.8 Cr during the year under review from INR 426.1 Cr in FY22.
As a startup that provides design and installation services for home interiors, HomeLane earns a majority of its revenue from sale of services. It also manufactures home interior-related goods through contract manufacturing.
The startup also earns a small part of its revenue as commission income, which is receivable from vendors of home furniture fittings and appliances on delivery of goods to HomeLane’s customers.
Including the commission income, other operating revenue, and interest income, the startup’s total revenue stood at INR 584.26 Cr in FY23 as against INR 431.83 Cr in FY22.
On the expenditure side, HomeLane’s total expenses grew 1.3X to INR 757.2 Cr from INR 581.7 Cr in FY22.
Employee benefit expenses grew 1.6X to INR 191.54 Cr from INR 119.4 Cr in FY22, led by a sharp increase in salaries and wages.
The startup spent INR 166.6 Cr as salaries in FY23 as against INR 103.73 Cr in the prior year. This increase came despite the company firing around 30-40 employees during the year. Total employee benefit expenses comprised over 25% of the company’s total expenses.
On the other hand, the startup also spent INR 71.3 Cr towards advertising and promotional expenses, a rise of mere 1.4% year-on-year (YoY).
HomeLane, in its filing with the Ministry of Corporate Affairs, said its advertisement expense of INR 70.2 Cr in FY22 included an expense of INR 1.57 Cr in relation to brand endorsement and right to subscribe agreement with a cricketer, which was zero in FY23.
FY22 advertisement expense also included INR 2.05 Cr in relation to credit facility arising from the advertisement agreement with BCCL, which was again zero in FY23.
It must be noted that HomeLane roped in MS Dhoni for its brand endorsement and also as an investor in the company in FY22.
The startup’s depreciation, depletion and amortisation expense in FY23 also jumped over 58% YoY to INR 13.9 Cr.
Founded in 2014 by Rama Harinath, Srikanth Iyer, and Vivek Parasuram, HomeLane offers personalised, end-to-end interior services. It claims to have built a community of over 30,000 customers across the country with services in over 22 cities and more than 50 experience centres.
In June this year, the startup said it closed a bridge round of INR 75 Cr from its existing investors to help accelerate its growth and expansion plans. HomeLane is backed by the likes of Peak XV, Accel, JSW Ventures, Mohandas Pai, and others.
In the home second and interior market, HomeLane competes with unicorn LivSpace and Kraftinn, among others.
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