Bengaluru-based home furniture and sleep solutions company Wakefit has delivered a successful fiscal year 2024 (FY24), with Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of ₹65.9 crore. The positive financial performance is accompanied by a strong 21% year-on-year increase in operating revenue, reflecting the growth trajectory of the company supported by its backing from Peak XV Partners.
PC: ET Retail
The company’s revenue from operations was up at ₹986.4 crore in FY24 as against ₹812.6 crore in the previous fiscal. The growth was mainly because of a 21.47% increase in product sales, which accounted for ₹967.86 crore of the total revenue. Besides, income from scrap sales and other minor sources grew by 16.73% to ₹18.49 crore. The firm also saw a dramatic surge in interest income from bank deposits, which increased 5.8 times to ₹19.38 crore, pushing its total revenue to ₹1,017.33 crore for the year.
Wakefit’s cost structure reflects its ongoing operational challenges, with materials expenses being the largest cost component at ₹465 crore, constituting 45.04% of total costs. Employee benefits also rose significantly, increasing by 27.3% to ₹134.63 crore. Courier and delivery charges saw a notable rise of 24.8% to ₹82.19 crore, while advertising expenses decreased by 19.3% to ₹77.36 crore. Overall, the company’s total expenses grew by 6.9% to ₹1,032.4 crore.
Despite the increasing costs, Wakefit showed excellent control over finances by reducing its losses to 90% and brought it down to ₹15 crore from ₹145 crore in FY23. This sharp decline in losses, coupled with the achievement of positive EBITDA, highlights the success of the company’s strategic initiatives and operational efficiencies. The ROCE and EBITDA margins of the company improved as well, to 0.29% and 6.48%, respectively.
On a unit basis, Wakefit spent ₹1.05 to earn a rupee of operating revenue, indicating a focused approach to managing costs while maximizing revenue. The company’s current assets grew substantially to ₹574 crore, with cash and bank balances reported at ₹17.21 crore at the end of FY24.
Since its inception, Wakefit has raised a total of $105.5 million from various investors such as Peak XV Partners, Verlinvest, and SIG. Continued support from such big investors shows confidence in the business model of Wakefit and its growth prospects in the competitive home furnishings market.
The home furniture and sleep solutions industry experienced a revolution with the growing awareness among the consumer about health and wellness, which encourages quality sleep. Wakefit’s innovative offering of products – comfort, quality at an affordable cost – has struck a chord with customers, driving demand and supporting its growth.
In conclusion, Wakefit’s achievements in FY24 are reflective of the good operating performance in a period of tricky economic times. With the reported EBITDA of ₹66 crore and a sharp decline in losses, the company is well-positioned to grow in the future. As it continues to innovate and expand its offerings, Wakefit aims to solidify its position as a leader in the home furniture and sleep solutions sector in the ever-changing needs of consumers in India. The next quarters are going to be very important for Wakefit as it uses this positive momentum and investor support to further enhance its market presence.
