iD Fresh Food, a Bengaluru-based startup renowned for its ready-to-cook products such as idli and dosa batter, significantly improved its financial performance in the fiscal year 2022-23 (FY23). The company’s net loss reduced by more than 50%, with a decline from INR 703.7 Crores in the previous year to INR 328.8 Crores in FY23.

The reduction in losses is particularly noteworthy, given the current funding challenges faced by Indian startups. These challenges have compelled companies to prioritize profitability due to the scarcity of fresh external capital.

iD Fresh Food secured its latest funding of INR 507 Crores ($68 million) during its Series D funding round in January 2022, with NewQuest Capital Partners and Premji Invest leading the investment.

Established in 2005 by P.C. Musthafa, Abdul Nazeer, Shamsudeen TK, Jafar, and Noushad TA, this startup distributes packaged ready-to-cook and frozen food items through a network of 30,000 retail outlets across India, the United States, the United Arab Emirates, and the United Kingdom.

The brand offers a diverse selection of products, including a range of idli and dosa batters, parotas, chapatis, paneer, and yogurt.

During the fiscal year in question, iD Fresh Food experienced a robust growth in its operating revenue, with an increase of more than 26%, rising from INR 381.6 Crores in FY22 to INR 479.2 Crores.

The startup generated 40% of its revenue from batter sales.

In FY23, it recorded INR 191.5 Crores in revenue from the sales of various batter products, marking a significant 49% increase from the INR 128.7 Crores it earned in FY22.

iD Fresh Food generated INR 167 Crores in revenue from parota sales, reflecting a substantial 24% increase compared to the INR 134.4 Crores earned in FY22.

The revenue from dairy products amounted to INR 64.1 Crores, showing a slight 5% decrease from the INR 67.6 Crores reported in FY22.

iD Fresh Food experienced a 14% increase in its total expenses, which rose to INR 517.1 Crores during the fiscal year under review, compared to INR 454 Crores in the previous fiscal year.

From a unit economics perspective, the startup incurred nearly INR 1 in costs to generate INR 1 in revenue from its operations.

The largest expense for the startup was procurement costs. During the fiscal year under review, the company allocated INR 172.3 Crores for the procurement of raw materials, reflecting a substantial 28% rise from the INR 135 Crores spent in the previous fiscal year.

Advertising expenses have exhibited a consistent increase, with iD Fresh Food allocating INR 35.3 Crores for advertising in FY23, marking a 27% growth from the INR 28 Crores spent in the previous financial year.

In FY23, the startup saw a 10% increase in its workforce, leading to a 20% rise in employee benefit expenditures. Employee-related costs reached INR 110.5 Crores in FY23, up from INR 92 Crores in FY22. According to LinkedIn, iD Fresh Food now boasts a team of 508 employees.

In July 2022, iD Fresh Food extended Employee Stock Ownership Plans (ESOPs) valued at INR 46 Crores to 27 of its employees, which encompassed drivers and support staff. This marked a significant milestone, bringing the company’s total ESOP grants to INR 300 Crores.

The EBITDA margin saw an improvement, moving from -13.3% in FY22 to -3% in FY23.

iD Fresh Food competes with formidable industry players, including MTR, Tata, Gits, and Aashirvad (ITC), all of which have substantial resources at their disposal.

This startup has garnered support from prominent investors, including Premji Invest, Helios Venture Partners, and NewQuest Capital, among others. In total, it has secured approximately $99 million in funding to date.