Tata Digital loss up nearly 6x in 2022; revenue grew threefold, shows data

Tata Digital, the digital business unit of Tata Group, reported a loss of Rs 3,051.89 crore for 2021-22 (FY22), nearly 6x up from Rs 536.75 crore in the previous year, reveals data accessed by business intelligence platform, Tofler.

Revenue for FY22 jumped 3x per cent to Rs 15,979 crore, from 2020-21 (FY21) revenue of Rs 5,315.27 crore, said the company in its regulatory filings. Total expenses for the period were up over 200 per cent at Rs 19,316.3 crore, from Rs 6,069.4 crore in FY21.

The company stated in its filings that the major heads of expenses were other expenditures of Rs 635.94 core (mainly comprising technology partner and platform infrastructure fees), employee costs of Rs 185.8 crore, and depreciation and amortisation of Rs 54.98 crore on a standalone basis.

On a consolidated basis, employee costs were at Rs 1,419.26 crore in FY22, from Rs 345.8 crore in FY21. Other expenses on a consolidated basis went up from Rs 700.45 crore to Rs 3,019 crore.

An email sent to the company did not elicit any response until the time of going to press.

However, people in the know said the company is on track with several of its internal targets.

“These numbers should be viewed not just as losses but as investments in customer acquisition. This is still the first year since the application (app) has been launched when customer acquisition is generally higher,” said sources, informing that the firm’s NeuPass members have touched 50 million.

According to a study by Inc42 in its State of Indian Ecommerce Q4 2022 report, Tata Neu managed to throw quite a few surprises during the festival season sale in 2022, which saw total sales of $5.2 billion.

For instance, the in-app experience was relatively better than its peers like Flipkart, Meesho, and JioMart, says the Inc42 study.

The e-commerce players were compared on a scale of 1-10, with Tata Neu scoring 4.8, the highest. Regarding product delivery during the festival season challenger, Tata Neu and JioMart trumped the well-established players.

According to Tata Neu’s LinkedIn page, Tanishq and Titan Company have also joined the super-app. Tata Digital has set up a target of 100-150 million users in the next two to three years.

According to a senior executive of Tata Digital, “The total customer base of Tata Group companies is around 122-130 million. The current database that Tata Digital has is 83 million (excluding Titan and Tanishq). Tata Neu already has 27 million NeuPass members.”

Meanwhile, recent reports suggest some issues with the top leadership, with Mukesh Bansal, president of Tata Digital, understood to have stepped back from day-to-day operations. Bansal, who had co-founded Myntra and health technology firm cure.fit, had been roped in by the group to get foreign investments into the new firm.

In the recent past, Tata Digital executives like Prateek Mehta and Sharath Bulusu have also resigned.