Sugar Cosmetics Revenue Jumps To Rs. 222 Cr While Loss Surges 3.6x In FY22

Sugar Cosmetics Revenue jumped to Rs.222 crore

In this article, we will explain Sugar Cosmetics revenue structure and the probable reasons that led to its substantial losses.

Sugar Cosmetics Revenue jumped to Rs.222 crore

The D2C (Direct-to-Consumer) beauty firms are booming at an exponential rate in India. Reason? Due to technological innovations, upgradation of consumer lifestyle as well as awareness. All these reasons are contributing to the makeover of the Indian beauty and personal care market. When it comes to D2C brands in the beauty segment, the names that float on top are Nykaa, Sugar Cosmetics, MamaEarth, etc. These brands are mushrooming through an omni-channel strategy. Do you know, Sugar Cosmetics revenue leaped by 75.6% to Rs.222 crore? However, this enormous revenue couldn’t confer profits to the company! Its losses crashed by 3.6 times to Rs.76.2 crore. Why did it make a loss despite making enormous revenue? You may ask. Go through the write-up and you will get the answer to your question.

Keep reading!

Sugar Cosmetics Revenue breakdown

First of all, let’s look at the bright side of the company. In FY22, Sugar Cosmetics earned revenue of Rs.222 crore. Do you know how much it earned last year (FY21)? Rs.126.4 crore. It is time to compare the Sugar Cosmetics revenue of the last two fiscal years.

Sugar Cosmetics Revenue SourcesFY 22 (Financial Year 2022)FY21 (Financial Year 2021)
Sale of Cosmetic and Beauty ProductsRs.221.8 croreRs.126.34 crore
Export IncentivesRs.0.03 croreRs.0.02 crore
Sugar Cosmetics Revenue Breakdown

The revenue of the company increased in every fiscal year. It is quite fascinating! Isn’t it? But there is an intense dark side to this scenario. Expenses! You will get to know about it in the next section.

Sugar Cosmetics Expenses Breakdown

Although Sugar Cosmetics went through a golden phase of gradual growth in revenue. In FY 22, the total revenue was massive i.e. Rs.222 crore. But they couldn’t celebrate it as they should! Why? You may ask. Because of its ballooning losses. Now look at the following expenses that led to the losses for the company “Sugar Cosmetics.”

ExpensesFY 22 (Financial Year 2022)FY21 (Financial Year 2021)
Cost of raw goodsRs.66.35 croreRs.40.75 crore
Marketing & Promotion ExpensesRs.97.4 croreRs.34.36 crore
Outsourced Support Services & Labour ChargesRs.43.61 croreRs.22 crore
Freight and Packaging ChargesRs.13.25 croreRs.8.8 crore
Employee Benefit ExpensesRs.35.52 croreRs.19.2 crore
Other Operating and Admin ExpensesRs.43.73 croreRs.23.9 crore
Sugar Cosmetics Expenses Breakdown

Now, you might have understood why Sugar Cosmetics is drowning in deep losses in spite of earning a massive revenue. However, as per the company, it sees its expenses as potent investments that will contribute to a significant amount of revenue in the future. 

Financials of Sugar Cosmetics

The financials of the company Sugar Cosmetics is summarized in the following table-

Sugar Cosmetics’ FinancialsAmount (in crores)
Market ValuationRs.4,133 crore
Revenue EarnedRs.222 crore
ExpensesRs.300 crore
Profit/LossLoss of Rs.76.2 crore
Financials of Sugar Cosmetics

So, here is your answer- “Sugar Cosmetics was not profitable in FY22 because it dipped in the loss of Rs.76.2 crore.” Even though it earned an appreciable amount of revenue from its numerous revenue sources. But the cash outflow in various expenses was high as well. This means the amount spent on expenditures exceeded the amount of revenue earned. Eventually, it continues to face a significant amount of loss i.e.3.6X.  

Future Plans of Sugar Cosmetics

As per the CEO Vineeta Singh, Sugar cosmetics is planning to expand its network all over India. Especially in the South Indian market. Aren’t you curious to know why they are focusing on the beauty market of the southern part of India? Because, it is getting over 24% of business from the south. This feature distinguishes Sugar Cosmetics from other companies of the beauty segment that are focusing on North India. Also, Sugar Cosmetics emerged as a popular brand of Gen-Z and millennials. Thus, the company is looking to spread across 550 cities in the country by making significant investments.  

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Published By: Supti Nandi
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Shivangi Kant
Shivangi Kant
11 months ago

As per Vineeta Singh, their target is to double our gross revenues to ₹600 crore in FY23 and to achieve net revenue of over ₹500 crore. This will be done by expanding sugar distribution and adding new categories. I find it great that they are covering South India and looking up to scale more.