bKash, the leading mobile financial services company has enjoyed another successful nine months in terms of revenue growth. The company which has been investing heavily into customer acquisition and merchant payment have grown by 21.8% YoY. The growth is mainly driven by acquiring a customer base and higher transaction volume. Loss after tax increased by 101.7% YoY mainly due to investment in marketing, human resource & technology.
Revenue
Revenue increased by Tk 3,636.9 Mn from 9M’20 mainly driven by customer acquisition and higher transaction volume. As of 9M’21, the total number of customers of bKash was 55.9 Mn which was 50.5 Mn in 2020. Total active customers in 9M’21 were 24.6 Mn which is about 44.0% of the total customer base of bKash. The company is growing strongly with a 76% market share (Bangladesh bank data doesn’t include Nagad’s data), 0.3 Mn Agents, and 0.3 Mn Merchants. Total transaction volume for the nine months of 2021 was Tk 4,301 Bn.
Gross Profit
Gross profit of bKash increased by only 8.7% YoY from Tk 4,391.8 Mn in 9M’20 to Tk 4,772,9 Mn in 9M’21. Gross profit margin decreased from 26.3% in 9M’20 to 23.5% in 9M’21 mainly due to higher growth in the cost of service compared to net revenue. The cost of services which is mainly the cost of agents’ and mobile partners’ commission has increased by 26.4% compared to the same period last year.
Profit
BKash continues to incur losses mainly due to lower gross profit growth and low finance income. Loss after tax increased from Tk 503.1 Mn in 9M’20 to Tk 1,014.6 Mn in 9M’21 mainly due to higher investment in marketing and technology. Operating and Administrative expenses increased by 19.1% YoY and Commercial Expenses decreased by 9.5% YoY. Net finance income declined significantly from Tk 433.3 Mn in 9M’20 to Tk 55.9 Mn in 9M’21 mainly due to lower cash and cash equivalents and low-interest rates on investment.
Conclusion
bKash continues to perform well in its focus areas. The customer base of the company is gradually increasing and so is the transaction volume. Although the number of merchants remained almost the same compared to H1’21 the company expects it to increase the numbers soon. Cash-In grew by 30.0% YoY and Cash-Out grew by 16.0% YoY. It is a positive sign for the company as more cash-in growth relative to cash-out means customers are using the other features of the company. Customers have also started to source funds from sources other than agents. There are bank account and card as other sources to source fund other than agents. Bank account and cards fund sourcing has seen a growth of 125.0% YoY and 80.0% YoY respectively. Hence, we believe that the company is going to continue its growth in revenue in the coming quarters.
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