Snapdeal’s revenue plummets 40 percent to Rs 903 crore for FY 2016-17

By

Maverick Martins

Published
Jan 29, 2018

Leading Indian e-commerce firm Snapdeal revenue saw a steep decline with revenues touching Rs 903 crore (approx $142.1 million) for the fiscal year 2016-17 down 40 percent from the previous financial year.
 

Snapdeal has been losing market share to major rival firms like Flipkart, Amazon and Paytm which are investing heavily in the Indian e-commerce market. Even though the online firm sold its digital wallet Freecharge to Axis Bank for Rs 385 crore to raise capital to keep its e-commerce model going, the firm’s losses continue to mount by the year.
 
Documents sourced from the business research platform Tofler by the Economic Times have shown that the company’s had reported a tunrover Rs 1,457 crore (approx $229.2 million) in the previous year while it reported losses of Rs 3,316 crore (approx $521.5 million) in the fiscal year 2016.

However, the mounting losses is not a major concern as Snapdeal has already begun several cost cutting exercises but the drop in revenue is something that the company will look to revive. It plans to spend heavily on marketing of its smaller version Snapdeal 2.0.
 
Last year, Snapdeal decided not to merge with larger rival Flipkart deciding to continue independently a decision that was backed by its investors. Snapdeal also took a major cost cutting exercise by laying off 80 percent of their workforce which is likely to reflect in the numbers for the current fiscal.
 
Snapdeal has been struggling in India’s fast growing e-commerce market and has slipped way behind other ecommerce giants like Amazon and Flipkart. It now competes with the likes of Paytm and Shopclues.
 
All this while Snapdeal had a logistics edge over other smaller online firms with their logistics arm Vulcan Express however, that too is likely to go as Future Group is expected to seal the deal for under Rs 50 crore to acquire the logistics unit from Snapdeal.