Just before the start of FY23, managed accommodation provider Stanza Living secured $57 million in debt financing, led by Kotak Mahindra and RBL Bank. This funding significantly contributed to the company’s remarkable growth, with a nearly fourfold increase in revenue during the fiscal year that ended in March 2023.
According to its consolidated financial statements filed with the Registrar of Companies, Stanza Living’s operational revenue soared to Rs 442 crore in FY23, up from Rs 115 crore in FY22.
Stanza Living operates a co-living platform catering to students and working professionals, boasting over 75,000 beds across more than 450 residences in 24 cities. The primary revenue source for the Delhi-based firm is its rental accommodation services, supplemented by earnings from food, annual maintenance charges, and other related services. Additionally, the company reported earning Rs 16 crore from interest on investments in FY23.
The largest expenditure for Stanza Living was employee benefits, accounting for 27% of total expenses. This cost rose by 14.3% to Rs 255 crore in FY23, up from Rs 223 crore in FY22. Lease obligations contributed to significant increases in finance and depreciation costs, reaching Rs 187 crore and Rs 218 crore, respectively, in the last fiscal year.
Stanza Living’s total expenses jumped by 66.6% to Rs 953 crore in FY23 from Rs 572 crore in FY22, driven by costs related to electricity, safety, legal and professional services, marketing, and other overheads.
Despite these increases in expenditure, Stanza Living managed to keep its losses in check, with an 18.71% increase to Rs 495 crore in FY23 compared to Rs 417 crore in FY22. The company saw improvements in its ROCE and EBITDA margin to -21% and -19.7%, respectively, indicating a more efficient operation with an expense to operational revenue ratio of Rs 2.16 for every rupee earned in FY23.
Having raised over $180 million in funding and valued at approximately $430 million in its latest equity round, Stanza Living is backed by significant investors, including Alpha Wave (formerly Falcon Edge), Matrix Partners, and Accel, with Alpha Wave being the largest stakeholder with a 26.62% share.
With its substantial bed base, widespread presence, and optimized operations, Stanza Living is poised for strong growth in the burgeoning co-living market, focusing on increasing occupancy rates and carefully adjusting operations to meet demand.
