Myntra plans to enter the US even as it makes four-fold losses

Fashion e-tailer Myntra has incurred losses to the tune of Rs 740 crores during the financial year 2014-15. It is four times more than what they made last year at Rs 173 crores. Its revenue in this period was Rs 758 crores as against Rs 427 crores in 2014.

Such heavy losses are a result of its big spending on promotions and deep discounts. Ad spend has almost doubled, it was Rs 90 crores in 2014 and now it is Rs 171 crores. Myntra has not been able to shore up revenues as it had planned for FY2015. CEO Ananth Narayanan says that the company plans to be profitable by 2017.

Flipkart, which owns Myntra, has put in over Rs 1,150 crores into the e-tailer since it acquired it in 2014. Yet, losses notwithstanding, Myntra is looking at entering the online apparel and accessories market in the US. It has also set up a subsidiary, Myntra Inc, USA. This move underlines Flipkart’s global ambitions as well as its expansion plans. It is trying to scale up its operations by getting more users to download its app on their smartphones.

Narayanan has said that it wants to be profitable by the end of 2016. He plans to push for Ebitda profitability as that it important for a sustainable business model. Also, he wants to make sure that ‘we are investing for the next 10 years as the business will be 10-fold’.