Fashion apparel startup Blissclub lays off 18% of workforce amid funding challenges

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February 10, 2024

Blissclub, a Bengaluru-based fashion apparel startup, reportedly laid off around 21 employees, or 18% of its workforce, in the second week of January, according to sources.

According to sources, during a town hall meeting on January 11, the startup’s founder and CEO, Minu Margeret, notified the employees of the decision to lay off 21 employees as part of a restructuring effort.

Nonetheless, multiple sources indicated that the number of employees impacted by the restructuring could potentially reach as high as 30.

“In the town hall, Margaret said the restructuring exercise was a pure business decision to move forward. Post this, impacted employees received invites for meetings within 10 minutes. They were informed about the layoffs in these meetings with their respective team heads,” one of the sources said.

The sources added that employees were instructed to voluntarily resign, or else face termination of their services.

Teams across various verticals, such as sales, marketing, growth, and product, were affected by the layoffs. However, the creative team suffered the most significant blow as it was entirely disbanded.

Continue Exploring: Apparel brand Bombay Shirt Company raises $3.2 Million in bridge funding round led by Singularity Ventures

The startup is paying a severance package of two months’ salary to the impacted employees.

Confirming the restructuring exercise, Margaret, said, “We had a one time restructuring done in Jan 2024 which impacted 21 employees of Blissclub. Come 2024, with some changes in strategy, our new direction meant these roles were impacted. In December 2023 we had our highest ever month in terms of topline for Blissclub.”

According to sources, the primary reason for the layoffs was the startup’s inability to raise fresh capital amid high cash burn. Blissclub last raised $15 million in its Series A funding round from Eight Road Ventures and Elevation Capital in May 2022.

Continue Exploring: Post funding bonanza of $340 Million, Udaan lays off staff in major restructuring move

Established in 2020, Blissclub initially operated as an online platform specializing in activewear products for women. Over time, it diversified its product offerings and ventured into opening several brick-and-mortar stores.

The company’s net loss surged 305.6% to INR 35.7 Cr in the financial year 2022-23 (FY23) from INR 8.89 Cr in the previous fiscal year. Operating revenue jumped 361.4% to INR 68.3 Cr from INR 14.8 Cr in FY22.

Meanwhile, total expenditure saw a significant increase, growing by 354% to INR 107.8 Cr from INR 23.7 Cr in FY22.

Following the layoffs, Blissclub has become another addition to the expanding roster of Indian startups engaging in restructuring efforts to reduce costs amid the funding downturn that began in 2022. Reports indicate that Indian startups have collectively laid off more than 34.7K employees since the start of 2022.

Continue Exploring: Meat retailer Licious lays off 80 employees in bid for enhanced efficiency

United Breweries reports INR 85.34 Crore net profit in Q3 FY24; sees growth in premium segment

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February 10, 2024

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United Breweries, a renowned beer manufacturer, reported a consolidated net profit of INR 85.34 crore for the December quarter of FY24, marking a significant turnaround from the loss of INR 1.97 crore in the same quarter of the previous financial year.

The company stated in a regulatory filing that its total revenue stands at INR 4,154.98 crore, marking a 12.28 percent increase from the INR 3,700.49 crore recorded in the corresponding quarter of the previous year.

The company reported an 8 percent volume growth in Q3, primarily led by the South and East regions, although this was partly offset by the North. Additionally, the premium segment experienced a growth of 14 percent.

“Within the (premium) segment, we see strong double digit growth for Kingfisher Ultra Max and we continue to drive premium volume growth,” said the company in a release.

Continue Exploring: United Breweries sets sights on premium beer segment to reclaim market share

On a year-to-date basis, the company’s gross profit margin was lower compared to the previous year, experiencing a decline of 142 basis points. However, in Q3, there was an improvement of 215 basis points.

“We continue to invest behind our brands to drive topline growth and further improve margins by revenue management and cost initiatives,” the company said.

During the first 9 months of the year, investments in capital expenditure amounted to INR 134 crore, mainly directed towards supply chain initiatives to accommodate future growth. The company noted that despite observing some inflationary softening since Q2, volatility is expected to persist.

“We remain optimistic about the long-term growth potential of the industry, driven by increasing disposable income, favorable demographics and premiumisation,” it added.

Continue Exploring: Premiumization trend to fuel India’s soaring liquor industry, Crisil Report reveals

Meanwhile, the Board of Directors has appointed Anand Kripalu as the Chairman of the Company, effective immediately. Kripalu currently holds positions as a Non-Executive Independent Director, Chairperson of the Stakeholders Relationship/Share Transfer Committee, and Member of the Audit Committee within the Company.

Anand currently serves as the Managing Director and Global CEO of EPL Limited, a company backed by Blackstone (formerly known as Essel Propack Ltd). Until recently, he held the position of Managing Director and CEO at United Spirits Ltd (Diageo India), also serving as a member of Diageo’s Global Executive team.

Earlier, he served as President for India and South East Asia at Mondelez International, President for Asia and Managing Director of Cadbury India, and was a member of Cadbury’s global leadership team. Prior to that, he spent 22 years at Unilever.

Wahter and Scrapbuddy join forces to recycle 10 Million PET bottles in Delhi-NCR

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February 10, 2024

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In a groundbreaking step towards environmental sustainability, Wahter, a trailblazer in packaged water, and Scrapbuddy, an innovator in PET recycling, have partnered to address plastic pollution in Delhi-NCR. Their shared objective is both ambitious and impactful: to recycle 10 million PET bottles within the next three months, transforming waste into valuable products such as fabrics and paver blocks.

Continue Exploring: At just INR 1 per bottle, Wahter shakes up India’s bottled water industry with game-changing approach

Armed with certifications from industry authorities such as FSSAI and ISO, Wahter is taking a significant stride in environmental responsibility by providing PET scrap to Scrapbuddy for its large-scale recycling initiative. Scrapbuddy, boasting a commendable history of recycling over 1,000,000 kilograms of PET scrap, demonstrates a steadfast dedication to decreasing carbon emissions and promoting sustainable waste management practices.

Scrapbuddy Founder Sachin Garg expresses excitement about the partnership, stating, “Our collaboration with Wahter is a significant stride towards a greener and more sustainable future. Scrapbuddy aims to make a lasting impact on plastic waste reduction in Delhi-NCR.”

Wahter Co-Founder Amitt Nenwani echoes this sentiment, saying, “We are thrilled to collaborate with Scrapbuddy in this impactful venture. Together, we aim to set new standards in PET recycling, fostering environmental responsibility and community engagement.”

Beyond mere business collaboration, this initiative mirrors a shared dedication to community-centric sustainability. The recycled PET materials generated by Scrapbuddy play a pivotal role in environmental preservation and community advancement, resonating with the shared vision of both companies for a greener and more sustainable Delhi-NCR region. Through their partnership, these two entities aspire to establish pioneering standards in PET recycling, nurturing environmental consciousness and community involvement.

Wahter will additionally serve as a distribution partner, facilitating the provision of clean and safe drinking water to the public and communities throughout Delhi NCR on behalf of boAt, a premier consumer electronics brand in India. This arrangement is established through boAt’s collaboration with the Shoobhi Foundation, a reputable NGO committed to social initiatives.

Wahter, a subdivision of the renowned Shiva Group, embodies a pioneering vision in marketing spearheaded by Amitt Nenwani and Kashiish A Nenwani. Employing a groundbreaking strategy, Wahter endeavors to revolutionize the marketing landscape by leveraging its bottles as dynamic platforms. It dedicates 80% of the space for brand advertisements, while reserving 20% to showcase its own identity, thereby advocating for affordability and transparency. Additionally, Wahter offers premium-quality drinking water at an unparalleled rate of just INR 1 per bottle.

Continue Exploring: Clear Premium Water expands portfolio with acquisition of Kelzai Volcanic Water

PepsiCo’s Indian market sees mid-single-digit growth in 2023

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February 10, 2024

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PepsiCo, a major player in the global beverage and food industry, reported on Friday a “mid-single-digit” growth in the Indian market for 2023. Globally, PepsiCo achieved a net revenue of USD 91.47 billion in 2023, marking a growth of 5.9 percent, according to the latest earnings report.

For the full year, developing and emerging markets such as “China and India each delivered mid-single-digit growth”, PepsiCo said.

However, PepsiCo’s net revenue in the Africa, Middle East, South Asia (AMESA) division, including India, stood at USD 6.14 billion, reflecting a decline of 4.64 percent.

This “primarily reflected a 21-percentage-point impact of unfavourable foreign exchange, driven primarily by the weakening of the Egyptian pound, and a net organic volume decline, partially offset by effective net pricing,” it said.

Within the region, PepsiCo noted a 2 percent increase in beverage unit volumes, with notable growth driven by double-digit expansion in India and low-single-digit growth in the Middle East.

Continue Exploring: PepsiCo India rides high on in-home consumption trend, records highest product launches since 1995

Nevertheless, the volume of its convenient foods unit experienced a decrease of 3.5 percent. This decline was predominantly driven by a high-single-digit decrease in South Africa, partially counterbalanced by high-single-digit growth in the Middle East and low-single-digit growth in Pakistan.

“Additionally, India experienced a low-single-digit decline,” it said.

However, its operating profit in AMESA grew 21 per cent, it added.

For the December quarter, PepsiCo’s net revenue in AMESA declined by 3.72 percent to USD 1.93 billion.

PepsiCo said it is expecting “at least 4 per cent organic revenue growth” in 2024.

“We are confident that our businesses will perform well in 2024 in the context of changing marketplace conditions. Category growth rates are normalising as consumer behaviours largely revert to pre-pandemic norms and net revenue realisation moderates as inflationary pressures are expected to abate,” said Chairman and CEO Ramon Laguarta.

Continue Exploring: PepsiCo India appoints Jagrut Kotecha as new Chief

Zomato’s strong Q3 performance spurs brokerage firms to boost price targets; Blinkit expansion drives optimism

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February 10, 2024

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Brokerage firms such as Jefferies, Nuvama, and Kotak have increased their price targets (PT) for Zomato stock following the foodtech giant’s announcement of a consolidated profit after tax (PAT) of INR 138 Cr in the December quarter (Q3) of the financial year 2023-24 (FY24). This surge was attributed to a significant expansion in its quick commerce business.

A large majority of brokerage firms have assigned a “buy” rating to the stock, anticipating a total return of 15% or higher within the span of a year.

Continue Exploring: Zomato reports third consecutive profitable quarter with INR 138 Cr PAT in Q3 FY24

While JM Financial, an investment banking firm, maintained its price target (PT) for the stock at INR 200, Jefferies revised its forecast upward to INR 205 from its earlier INR 190.

Similarly, Nuvama institutional equities raised its previous price target forecast of INR 140 to INR 180. Conversely, Kotak increased the number to INR 190 from INR 160.

Zomato’s shares closed at INR 149.45 on Friday, marking a 3.78% increase from the previous day’s closing price.

“Zomato continues to be one of our preferred picks in the listed Internet space as we believe it is well positioned to benefit from robust industry tailwinds for the hyperlocal delivery businesses. Its balance sheet also remains strong with net cash of INR 120 Bn as of December 2023,” JM Financials said.

The brokerage’s response follows the foodtech major’s third consecutive profitable quarter. Its net profit soared by 283% from INR 36 Cr in Q2 FY24. The startup earned INR 3,288 Cr from its operations during the quarter, marking a 69% increase from INR 1,948 Cr in the corresponding quarter of last year.

The company’s rapid growth has been driven by its quick commerce vertical, Blinkit. Due to increased festive demand, its revenue surged to INR 644 Cr, more than doubling from the INR 301 Cr it made in Q3 FY23.

Continue Exploring: Blinkit continues growth trajectory with second consecutive quarter of positive contribution

“Blinkit is the market leader in the fast-growing quick-commerce space and is set to see sharp margin improvements,” Jefferies said.

Zomato has indicated that it is on track to achieve adjusted EBITDA break-even for Blinkit on or before the June quarter of the financial year 2025. JM Financial identifies take-rate expansion, store operating leverage, and corporate-level operating leverage as key drivers for near-term margin expansion to reach break-even for Blinkit.

Furthermore, Kotak’s upgrade primarily stems from the strong indication of revenue growth in the Blinkit business.

“We believe that the margins of the business can also improve in tandem with the core business,” the brokerage said.

Nevertheless, the lion’s share of the total operating revenue was still generated by its food delivery vertical. Although the vertical’s revenue increased by 29% year-over-year to INR 2,205 Cr, the sequential growth failed to meet the company’s expectations.

According to Kotak, the demand environment was subdued during the quarter, resulting in lower-than-expected growth of 6.3% quarter-on-quarter in food delivery gross order value (GOV). Nevertheless, it highlighted that this growth surpassed that of some other players in the restaurant industry space.

Nuvama anticipates that the expansion of Zomato’s food delivery vertical will be fueled by enhancements in order frequency, the addition of restaurants, and a boost in market share.

“Based on SOTP [sum of the parts valuation], we are valuing the food delivery business at 60x Q4FY26 EBITDA deriving value of INR122/share ($ 12.1 Bn),” the brokerage said.

Another notable surge in the company’s operations came from its B2B arm, Hyperpure, which saw its revenue double to INR 859 Cr from INR 421 Cr a year earlier. The company is currently in the midst of establishing a plant to process value-added food supplies, aiming to further expand this vertical.

Continue Exploring: Zomato’s B2B vertical Hyperpure sees exponential growth in Q3 FY24, revenue inches closer to INR 1,000 Cr

Kotal anticipates that the capital expenditure incurred by Zomato will not significantly impact the overall size of the business. Consequently, the expected payback on this investment is deemed attractive. The brokerage also stated that Zomato intends to start with one facility and may consider expansion in the future.

Reliance Consumer Products bolsters confectionery portfolio with acquisition of Ravalgaon’s assets for INR 27 Crore

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February 10, 2024

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Reliance Consumer Products (RCPL) has acquired the trademarks, recipes, and all intellectual property rights of sugar-boiled confectionery maker Ravalgaon for INR 27 crore, as per a stock market disclosure by Ravalgaon Sugar Farm Ltd.

RCPL’s strategy of acquiring old Indian brands in distress and relaunching them aligns well with its recent acquisition of Ravalgaon, which boasts nine confectionery brands including Pan Pasand and Coffee Break. This mirrors its previous success with brands like Campa soft drink.

Continue Exploring: Reliance Retail to challenge Coca-Cola and PepsiCo with global expansion of Campa

The agreement was signed by both parties on Friday. It excludes the slump sale of all assets and liabilities of Ravalgaon.

“It is clarified that while 100% of the revenue of the company (Ravalgaon) is ascribed to the intellectual property being sold, the company will continue to hold all other assets such as property, land, plant, building, equipment, machinery, etc. post completion of the proposed transaction,” as per the disclosure.

Although the agreement includes a non-compete clause for Ravalgaon, the company clarified that it retains the option to engage in third-party manufacturing for other firms, including RCPL.

Ravalgaon generated a revenue of INR 9.66 crore in the fiscal year 2022-23.

This move will bolster RCPL’s competitive position against major players like ITC, Parle Products, and DS Group in the confectionery segment, where it already operates with two acquired brands – Lotus Chocolate and Toffeeman. Ravalgaon revealed in its disclosure that it has struggled to maintain its sugar boiled confectionery business in recent years, resulting in a decline in market share due to intensified competition from both organized and unorganized competitors.

Continue Exploring: DS Group boosts portfolio with acquisition of LuvIt Chocolate brand, solidifying market position

“At the same time, profitability has been affected by the sustained increase in raw material, energy and labour prices, without the ability to effectively pass on the input price increases to its customers beyond the INR 1- price point,” it said in the disclosures.

Additionally, Ravalgaon stated that as the company’s factory, machinery, and equipment have aged, the cost of production and associated wastage have also risen.

“The financial position of the company was exacerbated by the COVID-19 pandemic as schools and offices remained closed for physical attendance over a prolonged period, resulting in the reduction of movement of the company’s largest demographics of consumers. Being an impulse product, the absence of physical movement translated into weak demand,” it said.

Continue Exploring: Reliance’s Campa strikes major BCCI sponsorship deal, edges out Coca-Cola and PepsiCo

Tata Group’s Zudio makes big move with first flagship store launch in Noida

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February 9, 2024

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On Friday, Zudio, the affordable fashion brand owned by the Tata Group, opened its first flagship store in Noida.

Nestled beside the towering Hanuman statue and temple in Noida’s Sector 49, this store sprawls across 12,000 square feet, spanning two floors.

This marks the second Zudio store in Noida, yet it stands as its first high-street flagship store within the NCR city. Trent Ltd., the brand’s proprietor, presently manages a store in the Great India Place Mall located in Sector 38A.

Zudio, emerging as one of India’s most prominent success stories in value fashion, is undergoing rapid expansion to leverage the goodwill and buzz it has cultivated over the years.

The budget-friendly fashion label aims to launch approximately 200 stores throughout 2024-25. Should this come to fruition, Trent will see the total count of Zudio outlets reach between 650 and 700 by March 2025.

Continue Exploring: Zudio unveils its biggest store in North India, offering affordable fashion

Tata is setting its sights on transforming Zudio into a billion-dollar brand in the near future. P. Venkatesalu, CEO of Trent, outlined this ambition in an April blog post on the Tata Business Excellence Group’s website, stating their objective to achieve a compounded annual growth rate (CAGR) of over 25%. Additionally, they aim to maintain an Earnings Before Interest, Taxes, Depreciation, and Amortization (EBIDTA) margin of over 10%.

The seven-year-old Zudio has significantly contributed to Trent‘s business, driving its standalone revenue to more than double from under INR 3,500 crore before the pandemic to INR 8,000 crore in 2022-23. This surge has propelled the retail arm’s market capitalization to over $5 billion.

Trent, Tata’s retail venture, oversees operations of the Westside department store chain and Landmark bookstores. Moreover, the company has formed two joint ventures with Spain’s Inditex SA to manage the Zara and Massimo Dutti labels in India.

Zudio offers a diverse range of apparel for men, women, and kids, along with beauty products and loungewear, all attractively priced below INR 1,000.

Continue Exploring: Zudio expands its reach in Gujarat, opens first store in Palanpur

Swiggy Dineout kicks off Great Indian Restaurant Festival 2024 with over 7,000 participating restaurants across India

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February 9, 2024

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Swiggy, the Bengaluru-based food delivery giant, has announced the launch of Dineout’s flagship event, the Great Indian Restaurant Festival (GIRF), which began on February 7 and will continue until March 31. This festival features the participation of over 7,000 restaurants across 34 cities in India, offering discounts and deals to customers.

Throughout the festival, patrons can enjoy a generous 50% discount on dining bills at participating restaurants. HDFC Bank credit cardholders can further benefit from an extra 15% savings on GIRF transactions. Moreover, exciting partner deals are on offer, such as 20% off Uber rides and 40% off movie tickets through the Cinepolis app/website.

For the festival, Swiggy Dineout has collaborated with renowned eateries including Punjab Grill, Cafe Delhi Heights, Chili’s, Jamie’s Pizzeria, Roxie, Barbeque Nation, One8 Commune, Irish House, and Hard Rock Cafe.

In its latest edition, GIRF will showcase newcomers like Biergarten, Antera, Lord of Drinks, Ministry of Beer, and Anardana, alongside esteemed five-star hotels including Marriott, Leela, Hyatt, and Holiday Inn, providing opulent dining experiences.

Continue Exploring: Swiggy may file IPO by fiscal year end, plans to raise capital with combination of offer-for-sale and new issue; Prosus contemplates stake reduction

Swapnil Bajpai, Head at Swiggy Dineout, said, “Be it an avid food connoisseur or someone looking to explore new culinary tastes, GIRF 2024 has something in store for everyone. We are converging the country’s best restaurants, exciting offers, and unbeatable savings. Our goal is to make dining out more accessible and enjoyable for our customers while celebrating the best of what the restaurant industry has to offer.”

The company asserted that it saved INR 100 crore on food bills by attracting two million diners last year.

The festival will take place in major metropolitan areas like Delhi, Mumbai, Bengaluru, Hyderabad, and Chennai, as well as Tier-II cities such as Agra, Ahmedabad, Jaipur, and Kochi. It will include restaurant deals, partner offers with Uber, Pernod Ricard, and Cinepolis, along with additional payment options from RuPay, Simpl, and American Express.

Swiggy acquired Dineout, an online restaurant booking platform, from Times Internet in May 2022. Reports suggest the transaction was valued at $120 million in an all-stock deal.

Continue Exploring: Swiggy breaks new ground: Becomes the first food delivery platform to launch services in Lakshadweep

Emami delivers robust Q3 performance: Posts 12% growth in PAT to INR 261 Crore

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February 9, 2024

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Emami Ltd, a leading FMCG company, announced a notable 11.88% increase in consolidated net profit, reaching INR 260.65 crore for the December quarter of the fiscal year 2023-24. This growth was primarily driven by enhanced margins resulting from lower input expenses.

As per Emami’s regulatory filing, the company had recorded a net profit of INR 232.97 crore in the October-December period of the previous fiscal year.

During the quarter in review, revenue from operations increased by 1.38%, reaching INR 996.32 crore, compared to INR 982.72 crore in the corresponding period.

The domestic business revenue remained flat, while non-winter products saw a 5% growth. Additionally, the international business exhibited a constant currency growth of 11%, as reported by the Kolkata-based firm in its earnings statement.

Continue Exploring: Emami Group taps McKinsey & Co to explore expansion into packaged essentials and kitchen appliances

Regarding margins, Emami said that due to reduced input costs, the company experienced an improvement in gross margins, reaching 68.8 per cent, reflecting a substantial expansion of 290 basis points during the quarter.

In the December quarter, EBITDA stood at INR 315 crore, marking a 7% increase, with margins expanding by 170 basis points to reach 31.6%.

The company’s total expenses amounted to INR 681.45 crore, reflecting a 1% year-on-year increase.

Total income stood at INR 1,013.03 crore, indicating a 2.36% increase from the corresponding period of the previous year.

“The third quarter witnessed subdued demand trends, particularly in rural markets. Moreover, the period was characterized by the late onset of winter, negatively impacting the demand for winter contextual products,” it said.

Continue Exploring: Emami Limited acquires 26% equity stake in Axiom Ayurveda, expands into juice category with AloFrut brand

Despite facing these challenges, the company successfully navigated the dynamic business environment, showcasing resilience and achieving profit-led growth in Q3FY24, it added.

“Disrupted winter, weak rural demand and continued inflationary woes impacted the winter and discretionary offtakes. We remain committed to delivering volume-led profitable growth going forward aided by accelerated scale up of emerging channels, distribution initiatives, ongoing brand and strategic investments coupled with launch of innovative products,” Emami said.

Emami’s shares were trading at INR 487.25 each on the BSE, marking a 0.41% increase from the previous close.

KFC, Pizza Hut operator Sapphire Foods reports biggest quarterly profit drop since 2021 IPO

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February 9, 2024

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Sapphire Foods India, the company behind KFC and Pizza Hut eateries, reported its largest quarterly profit drop since going public in 2021. This decline was driven by intensified competition in the domestic market and reduced spending from consumers cautious about inflation, leading them to scale back on fast-food purchases.

The Yum Brands franchisee saw its consolidated net profit fall nearly 69% to 101.4 million rupees ($1.22 million) for the quarter ended Dec. 31.

Continue Exploring: Indian appetite for pizzas and burgers wanes: Domino’s and McDonald’s franchisee results reflect decline in dining out trends

According to LSEG data, analysts had anticipated an average profit of 239.6 million rupees.

During the quarter, inflation-hit consumers continued to reduce spending on discretionary items. To address this trend, fast-food outlets in India have been introducing more affordable menu options and ramping up marketing efforts to stimulate demand.

Nevertheless, companies like Sapphire, which offer pizzas starting at INR 169, have also encountered tough competition from local pizzerias offering more affordable alternatives, thereby impacting the profits of larger quick-service restaurants.

Continue Exploring: Domino’s Pizza takes on upscale pizzerias in India with premium offerings and hyper-localized approach

Same-store sales, indicating revenue growth from stores operating for a minimum of one year, dropped by 2% at KFC outlets and experienced a significant 19% decline at Pizza Hut locations.

The company’s total revenue increased by 12% to reach 6.66 billion rupees, while expenses surged by nearly 16%. Consequently, its margins on earnings before interest, tax, depreciation, and amortization (EBITDA) contracted from 19.6% a year ago to 18.4%.

Shares of Sapphire, which also manages Pizza Hut outlets in Sri Lanka, saw a 2% increase following the announcement of the results. This contrasts with a 2% decline in the third quarter.

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