Myntra Revenue Drops By 80% In FY 2018
Last year, Myntra recorded a growth of 90%. For FYI 2018, the losses of Myntra stood at 147 crore. Along with Myntra, its topseller Vector E-commerce also lost about 90% of its total revenue. Another segment of the company which is owned by Flipkart called Myntra Designs also witnessed a total drop of around 80% for the year. According to reports by MCA, its total revenue was around 427 crores at the end of March 2018. The total losses of Myntra for 2018 was around 151 crores. Its total expenses was recorded to 926 crores as per comprehensive reports. Vector E commerce, one of the top sellers of Myntra recorded around 81 crores in revenue from its usual 1216 crores (which was recorded in 2017). The sharp drop of revenue has worried several investors and the stock markets are taking a hit as such.
Currently, the company is focusing on expanding its business to the international markets and is focusing on its private brand named All About You which is backed by renowned actress Deepika Padukone. The brand will be launched across Canada at the Walmart Stores.
As per the spokesperson of Myntra, the sharp decrease in the revenue of the company does not signal anything as the results show a partial overview of the entire situation. The firm is still growing at its intended pace and the company will strive to provide the best value to its brand partners and customers by changing the fashion E-commerce industry of India.
Throughout 2018, Myntra has dedicated its time in developing several private labels. This resulted in a total increase of 25% in its total revenues. The company has around 14 private brands which includes Hrithik Roshan’s HRX,Anouk, Dressberry and Roadster. The company is also planning to launch more than 100 offline stores for HRX and Roadster in the next two years. Both Jabong and Myntra had integrated their business functions like creative, finance, revenue, category, marketing and technology teams by the end of November 2018. The parent company Flipkart has been facing some serious issues after the exit of their founding members, Binny Bansal and Sachin Bansal. The B2B arm of the company had reportedly faced a loss of around 2038 crores in FY18. In FY17, the total loss was around 245 crores.
Myntra as well as Flipkart have to face the coming challenges in the near future due to the new E-commerce FDI policy that might affect the private levels started by the companies. The new policy states that the companies will be not allowed to sell products at its own stake in their E-commerce platforms. Moreover, the policy also states that only 49% of FDI will be allowed in these inventory based companies. It also states that both the companies are forbidden from offering high discounts from their in-house partners which might affect the revenue generation of the companies.
To combat these issues, Myntra is planning on using its old private level business to gain higher margins from its competitors. It is also planning on expanding its offline business in the next two years.