Bengaluru-based B2B automotive marketplace Koovers reported robust top-line growth for FY25, with operating revenue rising sharply to ₹198 crore from ₹79 crore a year earlier, even as losses widened to ₹36 crore. The results underscore rapid market expansion alongside higher procurement and operating costs.
Business model and market context
Koovers operates a digital procurement platform that connects spare-parts manufacturers with workshops, dealers and garages across India’s fragmented automotive aftermarket. By digitising ordering and distribution, the company aims to reduce lead times and improve parts availability for small and medium repair centres.
India’s organised aftermarket is growing as vehicle parc expands and workshops increasingly adopt online procurement tools, creating opportunity for B2B marketplaces to scale volumes and reduce unit costs over time.
Revenue growth driven by expansion
The company’s nearly 2.5x revenue increase in FY25 was largely fuelled by aggressive expansion of its dealer and workshop network and investments in strengthening the supply chain. Core revenue derives from the sale of automotive spare parts and accessories, with higher digital penetration among buyers supporting demand.
Costs and impact on profitability
Total expenditure climbed to about ₹235 crore in FY25 from ₹96 crore in FY24, pressuring the bottom line despite stronger sales. Material procurement was the largest cost component, accounting for roughly 79% of total expenses—around ₹186.5 crore—reflecting the inventory-heavy nature of the business.
Employee-related expenses doubled to ₹22 crore as the company expanded teams to support operations, while logistics and marketing outlays also rose to facilitate faster delivery and market penetration. These investments widened net losses from ₹17 crore in FY24 to ₹36 crore in FY25.
Early signs of operational improvement
Despite higher absolute losses, Koovers showed modest efficiency gains. The cost-to-revenue ratio improved to ₹1.19 spent for every ₹1 earned in FY25, down from ₹1.22 in FY24, indicating some leverage as scale increased.
The pattern reflects a common “growth-first” approach in India’s startup landscape: prioritise network expansion and market share now, with profitability expected to follow as gross margins and operating efficiencies improve.
Outlook and considerations
Going forward, Koovers’ ability to convert scale into sustainable profits will depend on tighter inventory management, improved supply-chain economics, and controlled customer-acquisition costs. If the company can stabilise procurement margins and further reduce cost-to-revenue ratios, it could translate strong revenue momentum into healthier earnings.
