Rivigo FY 2019 revenue up 42% at Rs 1,028 crore
Rivigo works on a relay trucking model that allows drivers to drive for a maximum of four-five hours at a stretch and reach home the same day.
The five-year-old company, which has private equity major Warburg Pincus and SAIF Partners as investors and is valued at nearly $1 billion, reported a loss of Rs 600 crore for fiscal year 2019, compared to a loss of Rs 270 crore in 2018.
“The losses have increased in-line, given the investments in infrastructure and capability building…There has been a huge focus on long-term technology building, which is always front-loaded. We made these investments from which we are now reaping benefits, given patents that we have received,” Gazal Kalra, co-founder of Rivigo, told ET.
The company’s non-operating expenses has risen to Rs 813 crore, with a significant portion going towards technology development, building infrastructure capacity, and automation, Kalra said.
“The last one year has been focused on accelerated growth. We went pan-India, increased our fleet, and are now serving 29,000 pin codes in our LTL, or part truck business, up from 5,000 pin codes the year before,” he said.
The company has also increased its fleet size by 50%, adding 1,000 trucks over the course of fiscal year 2019. Currently, Rivigo has a fleet size of about 3,000 trucks.
Additionally, Rivigo also increased its LTL network capacity – processing centres, branches — increasing its warehousing space to 3 million square feet, up from 1 million sq ft in the year-ago period.
Kalra also said the company expects to be cash breakeven by the end of the ongoing financial year.
“We started seeing the headwind in the economy last November, which also nudged us towards focusing on our agenda of profitable growth. This year’s outlook is doing 30%-40% annual growth, but our margins structures have doubled,” Kalra said.
The company, which competes with the likes of Zinka Logistics, which owns and operates inter-city trucking and supply chain startup BlackBuck, works on a relay trucking model that allows drivers to drive for a maximum of four-five hours at a stretch and reach home the same day.
It also operates Rivigo Freight, its relay-as-a-service platform, where clients can post or add full truckload requirements and get truck supply with a single click at best spot market rates. It has about 4,000-5,000 fleet owners on the platform.
“We aren’t providing a vanilla marketplace where supply and demand can interact. It’s a very low margin and profitability transaction, where customer service or experience cannot be controlled…Relay-as-a-service works at scale, where fleet owners also see a benefit,” Kalra said.
According to Kalra, all of Rivigo's business lines are operationally profitable.