The company currently claims to have transactions totalling Rs 600 crore on its platform on an annual recurring basis, with 100% year-on-year revenue growth over the last three years.
Astrotalk is targeting Rs 2,000 crore in revenue in the next couple of years, he told ET, adding: “We will be doing the IPO prep once we hit these numbers. As of now, we are still evaluating options.”
People in the know told ET that the company has held early-stage talks with bankers such as JM Financial and others over the IPO. JM Financial did not immediately respond to ET’s request for comment. “We haven’t appointed a banker yet. We are in the middle of a fundraise and would plan things for IPO post that,” Gupta told ET.
Astrotalk reported revenue of Rs 282 crore in the financial year ended March 2023, compared with Rs 115 crore the previous year. The company’s profit after tax surged to Rs 27 crore from Rs 7 crore.
With its current run rate, the company expects to post a net profit of over Rs 100 crore on revenue of Rs 600 crore in FY24, Gupta said.
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Astrotalk operates on a revenue-sharing model with the 15,000-plus astrologers on its platform. The bulk of the company’s revenue comes from chat consultations (65%) and calls (35%). It also has a growing market among non-resident Indians who contribute about Rs 100 crore into the company’s transactions, Gupta said.The company is expanding into international markets including regions of Canada, the US, New Zealand and Europe.
It is planning an employee stock option buyback within the end of 2023, Gupta told ET. Currently, there is a 10% equity pool for these employees, 200 in number.
The company was in news for launching a funding round. Gupta confirmed to ET that the company is currently in talks to raise funds that will value it in the range from $200 million to $250 million. He declined to share further details.
Astrotalk claims to have over 30 million registered users, out of which more than 400,000 are daily active users. In FY23, the company’s expenses of Rs 230 crore covered astrologer and employee salaries and marketing cost.
Gupta had previously run CodeYeti Software Solutions, an information technology services company that served over 100 clients ranging from startups with a turnover of about Rs 1 crore annually.
CodeYeti was pivoted into AstroTalk in October 2017. Prior to that, he worked for about four years at several investment banks. For the first few years, the company would just allot astrologers through a computer-generated system. After it created a marketplace, where users were able to choose astrologers, its business bumped with users trying out multiple astrologers simultaneously, Gupta said.
Astrotalk charges about 19-21% of the transaction charge as its commission, with rates on its platform mostly starting from Rs 5 to about Rs 200 per minute, he said. The highest price listed on the platform, though, is Rs 600 per minute.
Metro and tier-1 cities constitute 80% of the company’s users based on revenue. “That is because in other cities, we are yet to penetrate with ads,” he said. Online ads are a core proposition of the company’s marketing strategy, with one celebrity per month endorsing the platforms to attract users. “We have worked with 40 celebrities so far. It helps us grow a lot, as trust factor increases with these endorsements,” he added.
On Monday, Astrotalk announced the elevation of chief business officer Anmol Jain to the role of a cofounder. “In his new role, Anmol will handle the company’s product, finance and operations and will be responsible for expanding overseas, strategic acquisitions and team expansion,” a statement said.