Sugar Cosmetics, the omnichannel beauty retailer, revealed an 89% year-on-year increase in FY23 operational revenue, reaching Rs 420 crore. Despite this significant growth, the net loss held steady at approximately Rs 76 crore.
In FY23, the Mumbai-based company experienced a 68% year-on-year surge in total expenses, amounting to Rs 505 crore. This increase was predominantly attributed to elevated expenditures related to acquisition of stock-in-trade, indicated by regulatory filings obtained from Tofler.
In the assessed period, Sugar Cosmetics substantially augmented offline footprint, nearly doubling store tally to approximately 200 by June 2023. For digital-first retail brands like Sugar Cosmetics. Venturing into offline expansion involves managing larger inventories, resulting in heightened expenditures related to stock acquisitions.
Established in 2015 by Vineeta Singh and Kaushik Mukherjee, Sugar Cosmetics initially emerged as an online-first direct-to-consumer (D2C) beauty brand and subsequently diversified into offline channels. In FY23, the company witnessed a 67% year-on-year surge in advertising expenditures, amounting to Rs 162 crore, constituting nearly 38% of its operational revenue.
In November, the company announced its trajectory towards achieving profitability by the conclusion of the current fiscal year. Company In April 2022, it secured $50 million in funding through a round spearheaded by L Catterton. With continued participation from existing investors A91 Partners, Elevation Capital, and India Quotient.
Sugar Cosmetics engages in competition within the beauty and personal care sector, contending with notable players such as Honasa Consumer, the parent company of Mamaearth, the omnichannel beauty retailer Purplle backed by Abu Dhabi Investment Authority, and Wow Skin Science supported by GIC and ChrysCapital. Additionally, it faces competition from various smaller direct-to-consumer (D2C) companies in the market.
Sugar Cosmetics’ revenue growth aligns with broader trend observed among beauty and personal care companies in the previous fiscal year. D2C beauty brand Plum, supported by A91 Partners and Unilever Ventures, disclosed 71% increase in FY23 revenue, reaching 322 crore. Likewise, Purplle experienced a doubling of its operating revenue to Rs 475 crore during the same period.
A collaborative study conducted by Redseer Strategy Consultants and Peak XV Partners projected India’s beauty and personal care market to exhibit a compound annual growth rate of 10% from 2022 to 2027.