ShareChat Parent Company Mohalla Tech Narrows Losses Despite Revenue Growth in FY24

Mohalla Tech, the parent company of popular Indian social media platform ShareChat and short-form video app Moj, announced its financial results for Fiscal Year 24 (FY24), revealing a substantial narrowing of its losses despite a challenging economic climate. The company reported a consolidated loss of Rs 1,898 crore, a dramatic improvement from the Rs 5,143 crore loss recorded in FY23. This represents a significant 63% reduction in overall losses.

This positive trend is further highlighted by a considerable decrease in expenses. Mohalla Tech slashed its total expenses by 50%, down to Rs 1,540 crore in FY24 from Rs 3,119 crore in the previous year. It’s important to note that this figure excludes non-cash components such as foreign exchange losses, depreciation, and employee stock option plan (ESOP) expenses, according to a report by Entrackr. The reduction in expenses, coupled with revenue growth, underscores the company’s proactive cost-cutting measures and operational efficiency improvements.

Revenue for FY24 saw a healthy increase of 33%, reaching Rs 718 crore compared to Rs 540 crore in FY23. Live-streaming emerged as a key revenue driver, contributing 56% of total income (Rs 403 crore), a substantial 41.4% year-on-year increase. Advertising revenue also showed robust growth, climbing 23.5% to Rs 315 crore. Furthermore, the company generated an additional Rs 29 crore from interest and gains on financial assets, bringing the total income to Rs 747 crore when including this non-operating income.

A significant factor in the improved financial performance was the decrease in employee benefits cost. This expense declined by 17% to Rs 580 crore in FY24, which included Rs 126 crore in non-cash ESOP expenses. The company’s cost optimization efforts are clearly yielding positive results.

Despite the losses, Mohalla Tech maintains a strong user base. Its platforms boast over 325 million monthly active users (MAUs), with Moj alone claiming approximately 160 million MAUs. This substantial user base positions the company for future growth and expansion.

The company has secured significant funding, having raised $1.3 billion from investors including notable names such as Temasek Holdings, Google, Twitter, The Times Group, Tiger Global, Snap, Lightspeed, and Elevation Capital. While the company’s valuation dipped from $5 billion to $2 billion during a fundraising round in June 2022, its improved financial performance suggests a potential rebound in valuation.

In conclusion, Mohalla Tech’s FY24 results demonstrate a clear path towards profitability. The substantial reduction in losses, coupled with strong revenue growth and impressive user engagement, paints a positive picture for the future of this influential Indian tech company. The company’s strategic focus on cost optimization and revenue diversification appears to be paying off, setting the stage for further success in the competitive Indian digital landscape.

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