Fintech unicorn BharatPe posted a net loss of Rs 5,610.7 crore in the last fiscal, rising nearly 3.4x from the Rs 1,619.2 crore loss it incurred in the financial year 2021, owing to a sharp rise in a one-time non-cash expense related to change in fair value of compulsory convertible preference shares (CCPS).
Keeping aside the CCPS cost, the Tiger Global-backed company’s adjusted loss grew 2.2x to Rs 828.2 crore in FY22 from Rs 227.3 crore in the fiscal before. It reported a loss due to change in the fair value of CCPS of Rs 4,782.1 crore and Rs 1,341.9 crore in FY22 and FY21, respectively, as per its financial statement available with the Registrar of Company (RoC).
“The CCPS-related item is a one-off and shall not be there from next year as we have now reclassified the compulsorily convertible preference shares from liability to equity,” BharatPe had said early this month while sharing a clarification around the soaring losses.
BharatPe’s revenue from operations, on the other hand, surged 3.8x to Rs 456.8 crore from Rs 119 crore in FY21. The company primarily makes income from commissions on loans and rental charges for point-of-sale (PoS) machines. Its income from commissions stood at Rs 151.8 crore while it made Rs 126.8 crore from PoS machines.
BharatPe, which is run by Resilient Innovations Private Ltd., was set up in 2018. The company began by launching the first interoperable UPI codes. It currently serves more than 1 crore merchants across 400+ cities.
The company is backed by a host of marquee investors such as Dragoneer Investment Group, Beenext, Steadfast Capital, Ribbit Capital, and Steadview Capital, among others. It became a unicorn in 2021 after it raised $370 million in its Series E round led by Tiger Global Management. To date, it has raised over $650 million in equity.
On the operations side, the company saw a sharp rise in financial guarantee payments to lending partners and transaction processing fees, which led to its expenses (minus the CCPS cost) surging 3.2x to Rs 1,483 crore.
Financial guarantee cost, which accounted for nearly 18% of total expenses, stood at Rs 266.6 crore in FY22. Whereas its transaction processing charges and employee benefits expenses jumped to Rs 227 crore and Rs 184.8 crore, respectively.
BharatPe claims its monthly loan disbursal rate is at around Rs 1,200 crores across all its products. It also claims that it facilitated disbursals of around Rs 4,500 crores in FY22 and is on track to do Rs 15,000 crores across the merchant and consumer side this year. “We remain on track to be operationally positive in the next few months,” the company said.
However, in the last few months, BharatPe has seen multiple high-level exits, including that of former chief executive Suhail Sameer. The company is also currently underway a court case against former cofounder and CEO Ashneer Grover, alleging financial misappropriation. Grover and his wife were ousted from the company in March last year.