The Souled Store's revenue rises to ₹500cr amid profitability slip
What's the story
The Souled Store, a leading direct-to-consumer pop culture brand, has reported a 37% increase in its operating revenue for FY25. The company's revenue from operations surged to ₹492 crore in FY25 from ₹360 crore in the previous fiscal year. However, despite this growth, profitability took a hit due to rising costs.
Product expansion
Brand has a diverse product range
Founded in 2014, The Souled Store has come a long way from just designing and selling pop culture-inspired apparel. The company now has a wide range of products, such as footwear, books, mobile covers, notebooks, mugs, and other lifestyle merchandise. These items are sold through both online and offline channels.
Financial details
Revenue breakdown and cost analysis
The bulk of The Souled Store's operating revenue, 98.5% to be precise, came from product sales across physical stores and online platforms. This figure rose by 36.8% to ₹485 crore in FY25. However, procurement remained the biggest expense for the brand as it scaled its operations with costs rising by 40.8% year-on-year (YoY) to ₹210 crore in FY25.
Profit decline
Rising costs impact profitability
Despite the healthy top-line growth, rising costs, especially higher employee benefits and marketing spends, have impacted The Souled Store's profitability. The company's profit declined by 37.6% to ₹11 crore in FY25 from ₹17.67 crore in FY24. However, it reported positive Return on Capital Employed (ROCE) and EBITDA margins of 7% and 9.7%, respectively.
Market position
Funding history and competition
The Souled Store has raised nearly $30 million in funding so far, including a $16 million round led by Xponentia Capital in 2023. Even as it continues to grow, the company faces stiff competition from brands like Rare Rabbit, Bewakoof, and Virat Kohli-backed Wrogn. Despite these challenges, The Souled Store is continuing to grow and expand, which may suggest optimism about its future prospects in the pop culture merchandise market.