INSUBCONTINENT EXCLUSIVE:
ET Intelliegence Group: Rising sales from online channels has led to a sharp turnaround for the kitchen-ware appliance company Butterfly
The south-based company has tied up with ecommerce companies, including Amazon and Flipkart, and has been aggressively selling its products
such as cookers, mixers, stoves through them.
As a result, the company has grown at an average of 20.5 per cent in the past four quarters
with consistent rise in the operating margin before depreciation (EBIDTA margins)
Online sales contributed over 20 per cent to total sales in the first half of FY20 from less than 2 per cent two years ago
Before the online strategy, the company had a relatively weaker dealer network as compared with the peer TTK Prestige
Selling online has therefore given it better reach and distribution
More importantly, the receivable days by selling online are nearly 50 days compared with more than 75-80 days for the conventional business
model.
This should improve the overall return ratios and cashflows
In the next two years, online revenue is expected to touch 30 per cent while the total revenue is expected to grow by over 15 per cent
according to analyst reports.
In the first half of FY20, its revenue increased by 15.2 per cent year-onyear to Rs 393.5 crore and net profit
rose by 39 per cent to Rs 10.6 crore
The EBIDTA margin was 8.4 per cent, 60 basis points higher over the corresponding period in the previous year
20 per cent in the past one month
with 40 times for TTK Prestige.
