Square Yards Q4: Robust Financial Results Boosts IPO Hopes

India-based Square Yards delivered solid financial results for its end-of-year and Q4 2024 activities, with growth quarter-on-quarter and year-on-year.

Highlights include:

• ~INR 1000cr revenue (USD 120mn), up 51% YoY and 46% QoQ.
• EBITDA profitability for the year;
• Operating cash flow breakeven for H2FY.

Square Yards is a diversified PropTech business and real estate marketplace. For consumers, the company operates a core new homes listings service as well as an existing homes segment (Square Yards), a property management business (Azuro), a renovations business (Interior Company) and a fintech offering (Urban Money). Square Yards reported that all segments except the home renovations business were profitable for the year.

The company said:

"FY24 was the year of 'more of the same' and we believe, with sub 2% market share across all segments, the focus will continue on consolidating market share in the markets/segments we are present."

Annualised revenue stood at circa USD 180 million, with the company quick to highlight that 2024 was "the first ever year of corporate profitability."

Cash flow from operations experienced a major shift, from a loss of INR 564 million (USD 6.75 million) in H1 2024 to a sliver of profitability at INR 20 million (USD 0.24 million) in H2 2024.

Financial services continued their strong growth, worth 45% of total revenues for the year, followed closely by real estate services which contributed 43% of total revenues. The renovations business contributed 8% of total revenues while digital products and services were worth 4% of total income.

A press release said:

"The Q4 (and H2) margin profile gives significant credence to our oft-repeated "operating leverage led steady state margin targets" once the investment cycle is over.

"The capacity addition should continue in 1HFY25, and we expect 2H of FY25 to show a similar strong margin profile.

"Real estate services had a muted growth year (only 25% YoY) but sharp uptick in orderbook (up 50%) implies a strong visibility of FY25 revenues.

"Real estate led the margin profile with 21% contribution margin, while Financial services and Digital products were profitable with single digit margins. Gross margins of home renovations picked up sharply YoY but it is still making losses. Monthly traffic remains strong at ~8mn/month."

They say the devil is in the details, and Square Yard's prediction for the 2025 financial year will bode well for a company that intends to raise an investment round worth up to $120 million in preparation for an IPO in 2026—which may make it one of a handful of unicorns globally.