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Blossoming Challenges :Ferns N Petals Faces Fiscal Plateau in FY23 Amidst Diversification Dreams

Ferns N Petals, the gifting platform based in Delhi, witnessed substantial growth in previous fiscal years; however, its momentum hit a plateau in FY23.


Despite a modest 4.8% increase in income, the company faced significant losses amounting to nearly Rs 110 crore during the fiscal year as compareed to Rs. 10 crore loss in previous year.


The consolidated financial statements reveal that the revenue from operations rose from Rs 579 crore in FY22 to Rs 607 crore in FY23. The primary sources of income for Ferns N Petals include the sale of cakes, flowers, and customized gifts, constituting 92% of its total operating revenue. These products are distributed through the company's websites, third-party e-commerce platforms, and physical stores, with a network of over 400 franchise outlets in 125 cities across India.


Aside from product sales, the company generates income from delivery, convenience, packing, and forwarding charges. Ferns N Petals also operates in the hospitality and wedding sectors through Udman Hotels and FNP Weddings and Events. While the financial numbers for these units weren't provided in the consolidated results, FNP Weddings and Events Pvt Ltd reported a topline of Rs 70.76 crore and a profit of Rs 4.43 crore in FY23. Despite these ventures, the company faced challenges, leading to losses and a decline in key financial metrics.

Notably, the cost of procuring materials accounted for the largest portion (38%) of total expenditure, increasing by only 2.2% to Rs 278 crore in FY23. Meanwhile, employee benefits grew by 13% to Rs 121 crore. Overall expenditure, including advertising, marketing, legal, freight, and information technology, surged by 25% to Rs 723 crore in FY23. This increase, combined with flat revenue growth, resulted in a significant loss of Rs 109 crore, contrasting with a Rs 10 crore profit in FY22. The return on capital employed (ROCE) and EBITDA margin deteriorated to -81.2% and -14.9%, respectively.


Despite the challenges, Ferns N Petals continues to eye expansion, recently announcing plans to enter the food and beverage industry with The U Kitchen. The company's move into diverse segments reflects its evolution from a humble florist into a multifaceted business. However, the article suggests that Ferns N Petals should approach new ventures more discerningly to navigate the competitive landscape and regain its edge in the market.


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