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Jugnoo turns EBITDA positive in the first quarter of FY17

Jugnoo has turned cash flow positive with profitability on an EBITDA basis. The company has recorded its first month as a free cash flow positive business in the first quarter of the current fiscal year (FY17). It’s not clear if the month in question was April, May or June. If it was April or May, did it remain cash flow positive in the remaining month(s) of the quarter as well? The company also mentioned that the net revenue recorded for the final quarter of FY16 was Rs 11.5 crores, up 15% month-on-month. While for the first quarter of FY17, Jugnoo is on track to post net revenue of over Rs 13.5 crores, the company claimed.

Jugnoo’s founder and CEO, Samar Singla said that the company has been focusing primarily on tier-II and tier-III towns and cities, which according to him has its own advantages such as:

a) Higher brand loyalty, because customers have limited options.

b) Significant growth in adoption of tech platforms for daily purchases.

Currently, the Chandigarh-headquartered company is operational in 40 Indian cities, has over 15,000 auto drivers on its platform, and claims to handle 50,000 transactions per day for around 5 million users. The company also provides B2B logistics solutions to over 17,000 clients across 150 countries, which has proven to be a major revenue source for Jugnoo.

Note that Jugnoo had launched its on-demand B2B logistics service Dodo deliveries in Chandigarh Tri-city (Chandigarh-Mohali-Panchkula), in June last year. The plan was to expand it to Indore, Gurgaon and Noida in two weeks’ time, and then to over 15 cities over the next 2 months. At the time, there was no stipulated size for minimum order, and the company had claimed that it was doing 200 deliveries per day. It charged for deliveries, starting from Rs 30 per delivery. But this surely isn’t the same B2B logistics solutions the company says is operational across 150 countries?

Jugnoo also offers

Fatafat, hyperlocal delivery service: It was first started in March 2015 and withdrawn after about eight months. It was restarted in May 2016, starting with Chandigarh, followed by the Delhi National Capital Region in June. Initially, the service was restricted to delivering vegetables and fruits through the company’s network of autorickshaws. Eventually, it morphed into a meal and tiffin delivery service, which didn’t aggregate restaurants but rather included food items sourced from undisclosed brands.

Food delivery: In January this year, Jugnoo entered the restaurant food delivery segment with the launch of its ‘Menus’ service. Initially, the service was live in Noida, Gurugram, Indore, Chandigarh and Jaipur. The food is delivered via Jugnoo’s existing network of autorickshaw drivers.

Grocery delivery: In October 2016, Jugnoo launched a grocery delivery service called Grocery in Chandigarh. The company had tied up with local wholesalers in Chandigarh and had 3,500 stock keeping units (SKUs) to offer next day delivery for orders placed between 4-8pm. This service was possibly launched after the Fatafat service branched into tiffin deliveries a few months earlier.

Cab aggregation: In February this year, around the time when Ola and Uber drivers were on strike in Delhi protesting the reduced incentives and low earnings, Jugnoo further diversified its business and entered the cab aggregation services space, starting with Gurugram. At the time, Jugnoo’s COO Chinmay Agarwal had told MediaNama that the company already had 150 drivers on board and planned to increase it to 2,000 over the next few weeks. He had also mentioned that Jugnoo will be looking at car pooling at a later stage.

Note that all these services are now available on a single app.

Where does Ola stand?

Ola Cabs’ parent ANI Technologies Pvt. Ltd. reported revenues of Rs 758.23 crore for the financial year ended March 31, 2016 (FY16), according to this Livemint report. This was over seven times of the Rs 103.8 crore revenues posted in FY15. However, during the same period its losses almost tripled. The company posted losses of Rs 2,313.7 crore for FY16, as compared to losses of Rs 796 crore in FY15. Interestingly, the Livemint report mentions that the revenue Ola had reported for FY15 are significantly higher than what the regulatory filings show.

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    © 2008-2018 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ