Milkbasket eyes break even in Jul-Sept quarter on rising e-commerce demand

Topics Coronavirus | Milkbasket | Lockdown

Milkbasket has also witnessed a 2.2 to 2.5 times increase in its average order value across its 130,000 active user base while it has been onboarding 500-1,000 new signups on a daily basis since the lockdown
Online home essentials and grocery delivery start-up Milkbasket is expecting to break-even in the July-September quarter (Q2), as the adoption of e-commerce in the country sees a huge boost, triggered by the coronavirus-induced lockdown.

“We are very much on track to achieve overall profitability (by September-end) while we had turned operationally profitable in April,” said Anant Goel, co-founder and chief executive officer (CEO) of the Gurugram-based firm. “In December, when we started focusing on profitability, only Gurugram had turned profitable by then. Our focus was to make one city profitable in every quarter.”

Milkbasket is present in four cities — Gurugram, Noida, Bengaluru and Hyderabad. Goel said the company had achieved break-even in three cities and Hyderabad will join that list soon. 

“We will probably be the first player in the online grocery space to achieve profitability in India. No other company has been able to do that because of the perception that break-even can’t be achieved in smaller scale,” he said.

Milkbasket has witnessed a 2.2 to 2.5 times increase in average order value across 130,000 active user base while it has been onboarding 500-1,000 new signups on a daily basis since the lockdown. This comes as Covid-19 has given a fillip to e-commerce firms as more consumers have shifted to ordering groceries online. According to Forrester Research, India’s online grocery market could hit $3 billion in sales this year, an increase of 76 per cent over the previous year.

Earlier this week, the company announced raising $5.5 million in Series-B funding, led by Inflection Point Ventures. The funding will be used for hiring more people and upgrading technology, the company said. According to data compiled by Crunchbase, the start-up has raised $38.8 million to date.
Milkbasket, however, said it was still facing manpower shortage problems and employee costs have been inching higher because of the prolonged supply issue. Training of fresh talent and former gig-workers laid off by hyperlocal start-ups has been taking time, Goel said. He also downplayed the news reports that suggested Milkbasket being the acquisition target for Amazon, Bigbasket and Paytm Mall.

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