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Fintech unicorn Pine Labs reported a significant decline in its revenue and a big jump in its net loss in the pandemic-affected financial year 2020-21 (FY21). 

The IPO-bound startup’s operating revenue dropped about 14.2% to INR 726 Cr in FY21 from INR 846 Cr in the previous fiscal year, according to its regulatory filing. 

As a result, Pine Labs’ losses almost tripled to INR 247.9 Cr during the year from INR 93.7 Cr in FY20.

On the other hand, its total expenditure also increased marginally to INR 1,025 Cr in FY21 from INR 1,002 Cr in the previous fiscal year.

Employee benefits expenses had the biggest share in total expenses, contributing 47% to it. Pine Labs’ spending on employee benefits grew about 61% year-on-year (YoY) to INR 482.9 Cr in FY21. This included INR 131.6 Cr as non-cash employee stock ownership programme (ESOP) expenses.

In fact, as per media reports, in May 2020, some of Pine Labs’ top officials, including Executive Chairman Lokvir Kapoor, Vice President Rakesh Sharma, and CTO Sanjeev Kumar, earned about $31 Mn through their secondary stake sale.

In FY21, the startups’ sales and marketing costs also increased to INR 239 Cr from INR 160 Cr in FY20.

The cost of spares and other ancillary items, including items like cost of paper rolls used in merchant equipment, doubled to INR 46.7 Cr in FY21. This cost stood at INR 22.8 Cr in FY20.

Pine Labs’ transaction cost increased over 48% to INR 53.5 Cr in FY21. This cost included switch fees paid to service providers, payment gateway charges and support charges for deploying point of sales (POS) devices.

Pine Labs, founded in 1998, claims that currently, 1,40,000 merchants benefit from its cloud-based platform across 3,700 cities and towns in India and Malaysia. More than 15 major banks, seven financial institutions and more than 100 brands are a part of Pine Labs’ platform that processes payments worth $30 Bn every year.

Pine Labs was founded by Lokvir Kapoor and it enables online and offline retail transactions, with its core offering being PoS machines. Later, Amrish Rau joined the company as the CEO in March 2020.

The startup announced acquiring Kuala Lumpur-based payments and discovery platform Fave in a $45 Mn deal in April last year. As per its FY21 regulatory filing, Pine Labs generated INR 70.7 Cr in revenue for the year as commission fee for payments using the Fave application.

The startup has been planning its initial public offering (IPO) for quite some time and was earlier eyeing a US listing. Recently, Pine Labs acquired Bengaluru-based fintech infrastructure startup Setu in a deal valued at $70 Mn-75 Mn.