Battery Smart Reports Significant Revenue Growth

Battery Smart, a leading battery-swapping network catering to electric two- and three-wheelers, has experienced a remarkable three-fold increase in revenue for the fiscal year ending March 2024. Despite this growth, the company’s losses also doubled as the Gurugram-based enterprise aggressively aimed for expansion.

Revenue Increase for Battery Smart

Battery Smart’s operating revenue surged by 193%, climbing to Rs 164 crore in FY24 from Rs 56 crore in FY23, according to consolidated financial statements obtained from the Registrar of Companies (RoC).

The company specializes in battery swapping for electric two- and three-wheelers, providing battery-as-a-service solutions to vehicle manufacturers. This service remained the sole revenue source for Battery Smart in FY24.

Additionally, the company earned Rs 23 crore from interest on financial assets, bringing its total income to Rs 187 crore in FY24.

Expenditure Analysis

On the expenditure side, depreciation charges surged 3.8 times to Rs 85 crore. Finance costs increased nearly 3.75 times to Rs 45 crore, and employee benefit expenses rose by 95.2% to Rs 41 crore. Interestingly, advertising costs decreased by 60% to Rs 8 crore during the fiscal year.

Overall, Battery Smart’s total expenditures exceeded Rs 327 crore in FY24, more than doubling from Rs 125 crore in FY23. Further breakdowns of the expenses can be found in various other sources.

Net Loss and Financial Metrics

Despite robust revenue growth, Battery Smart’s losses widened considerably. The company recorded a net loss of Rs 140 crore in FY24, more than double the Rs 61 crore loss from FY23. The Return on Capital Employed (ROCE) and EBITDA margin were reported at -18.34% and -5.35%, respectively. On a unit basis, Battery Smart spent Rs 1.99 to generate one rupee in operating revenue.

By March 2024, the Gurugram-based firm had current assets amounting to Rs 328 crore, including Rs 107 crore in cash and bank balances.

Investment and Market Position

According to data from startup intelligence platforms, Battery Smart has raised approximately $192 million in funding to date, with Tiger Global and Blume Ventures as its primary investors. The co-founders, Pulkit Khurana and Siddhart Sikka, collectively hold a 28.5% stake in the company.

Battery Smart is strategically positioned to capitalize on the growing trend of electrification in India’s mobility sector, particularly in the two and three-wheeler segments. The company is incurring substantial costs while establishing optimal Standard Operating Procedures (SOPs) in a complex market. Its near-complete focus on B2B segments could be a significant advantage.

Nevertheless, the primary risk involves potential resistance from large manufacturers who may prefer proprietary batteries or the development of their own battery-swapping networks, as seen recently with Honda. Regardless, Battery Smart continues to maintain a strong position, especially in the three-wheeler sector, where the swapping model currently outperforms traditional charging options by saving time and facilitating higher vehicle usage.