Reverse logistics firm Nuvo Logistics Pvt. Ltd, which also runs online grocer PepperTap, posted a profit in 2014-15 on higher demand for its business of handling product returns, official data showed.
The company posted a profit of Rs.87 lakh on revenue of Rs.19.5 crore, according to documents filed with the Registrar of Companies.
Nuvo, which began operations in August 2013, had posted a revenue of Rs.61 lakh for the eight-month period ending March 2014, documents filed with the Registrar of Companies show. In the same period, the company had incurred a loss of Rs.41 lakh.
The company worked with almost 20 clients in 2014-15, including e-commerce companies such as Shopclues. It had five clients in the eight-month period ending March 2014.
Nuvo Logistics, which ventured into hyperlocal delivery services of groceries under the brand name PepperTap in November 2014, earned most of its revenues from the reverse logistics business during 2014-15.
“Majority of turnover was from reverse logistics business, as PepperTap had just started in January 2015, at a small scale initially,” co-founder Navneet Singh said in an email.
At an event in December, Singh had said that Nuvo was considering hiving PepperTap off into a separate entity, since it is a fast-growing business. He had also said PepperTap was yet to turn profitable, but declined to share a timeline.
The name for the new entity has not been decided yet. Nuvo will retain its name and be headed by Ankur Agarwal, currently the business head of NuvoEx, the reverse logistics entity, Singh said.
For the year ending March 2015, Nuvo saw a significant increase in expenses, nearly half of it due to wage bills. Employee benefits and managerial remuneration together accounted for Rs.9 crore of the total expense of Rs.18.4 crore for the period.
Nuvo Logistics was launched to test the waters in logistics before entering the business-to-consumer (B2C) space. It fulfils almost 10,000-12,000 orders a day and operates across 30 cities in India.
PepperTap, on the other hand, has operations in 18 cities and fulfils close to 20,000 orders a day. It aims to service 90,000 orders a day by the end of December 2016. However, the company, which in September planned to double its staff to 5,000 and expand operations to 75 cities, now plans to go slow on expansion.
It stopped operations in smaller cities such as Agra and Meerut nearly four months ago after pilot projects showed no serious traction.
PepperTap has grown from $1 million GMV (gross merchandise value, or the cost of goods sold) at the start of 2015-16 to $50 million GMV on 21 December 2015.
Backed by Sequoia Capital and SAIF Partners, Nuvo Logistics has raised over $51 million since 2013. Other investors in the company include Russia’s Ru-net, Japanese private equity firms JAFCO and BeeNext, venture debt firm Innoven Capital and online marketplace Snapdeal.
Co-founder Singh held close to 58.12% shares in the company until March 2015. In September, Snapdeal along with new investors including Ru-net, JAFCO and BeeNext picked up an undisclosed stake in the company.
Nuvo last month acquired delivery start-up Jiffstore for an undisclosed amount in a cash and stock deal.