Blockchain technology enabler New Street Technologies posted a significant three-fold growth in its scale during FY23. Interestingly, the profits of the company spiked 4.8X during the previous fiscal year ending March 2023.
New Street’s revenue from operations surged 3.6X to Rs 36.9 crore in FY23 from Rs 10.15 crore in FY22, according to its annual financial report filed with the Registrar of Companies.
New Street empowers enterprises to modernize their existing infrastructure by harnessing technologies, including blockchain, AI, ML, and IoT. The company’s leading blockchain product, MiFiX, plays a pivotal role in enhancing various financial services such as banking, FAR (finances against remittances), and agricultural loans.
As per the company, its product drastically cuts down technology maintenance overheads and operational costs.
With a notable client base including Federal Bank, Dhanlaxmi Bank, Kotak Life, etc., providing servicing to them through its products is the only source of revenue for New Street.
On the cost side, delivery partner cost accounted for 62% of the overall expenditure. This cost rose 3.6X to Rs 21.95 crore in FY23. Its employee benefits soared 4.6X to Rs 6.74 crore in FY23. It Includes a 1.32 crore ESOP cost.
The company added another Rs 1.1 crore towards legal and professional fees, pushing its total expenditure to Rs 35.26 crore in FY23 from Rs 10.3 crore in FY23.
New Street’s three-fold scale and controlled expenditure helped the company to achieve a 4.8X spike in its profits to Rs 1.9 crore during FY23. Its ROCE and EBITDA margin were registered at 5.21% and 10.33% during FY23. The company spent Rs 0.96 to earn a unit of operating revenue.
The company raised $4 million during FY22 (September 2021 ) from Vittal Kadapakkam in the US, prominent Indian bankers, and existing investors including Unitus Ventures.
While it’s early days to pass judgement on the firm, the tight control on costs augurs well in terms of opportunities for future growth. While it remains difficult to hazard a guess on the funding environment for it considering its portfolio size and client roster, funding constraints might yet force it to go slow on investing in faster growth, which remains a risk in the intensely competitive fintech space.