boAt Incurs Losses in FY23; Revenue Growth Tapers Amid Intense Competition

The latest fiscal year has marked a turbulent period for Imagine Marketing Limited, the parent company of the renowned wearable brand boAt. Despite reaching a commendable milestone of achieving its best-ever revenue of Rs 3,377 crore during the fiscal year ending March 2023, the company reported a disheartening loss of Rs 129.4 crore. Despite boasting remarkable gain, which experienced an approximate 18% year-on-year growth, this paled compared to the staggering 133% average revenue growth in the preceding three fiscal years.

boAt’s closest competitor, Noise, experienced a revenue surge of 80% at Rs 1,426 crore, juxtaposed against a profit of Rs 88 lakh during FY23, and the financial year posed additional setbacks for boAt, notably with its unsuccessful IPO bid despite securing its position as the world’s second-largest wearable brand, trailing only behind Apple.

While the smartwatch and wearable segment flourished with a remarkable 75% year-on-year growth, the sales of audio accessories plateaued at a mere 3% during FY23. The company’s wearable sales amassed Rs 902 crore, while Noise recorded Rs 1,138 crore in the same period.

boAt is engaged in unconventional marketing strategies, led by Aman Gupta, the company’s chief marketing officer and a well-known face from the popular business reality show Shark Tank. However, faced with increasing market pressure from established brands like OnePlus and Xiaomi and emerging competitors like Noise, boAt was compelled to escalate its advertising spending substantially. Advertising expenditures skyrocketed from Rs 99 crore in FY22 to approximately Rs 428 crore in FY23, accounting for a significant surge.

Amid its tenth year of operations, boAt has transitioned from being a consumer electronics marketer to a manufacturer. Partnering in a joint venture with Dixon and acquiring Singapore-based electronics development company KaHa signifies the company’s commitment to bolstering its IoT devices and audio design processes. The company’s strategic moves toward domestic manufacturing and expanding its product portfolio demonstrate a resilient response to an evolving industry landscape and fierce market competition.

Overall, the recent fiscal marked a period of transformation and challenges for boAt, navigating the complexities of scaling up operations while recalibrating strategies in an intensely competitive consumer electronics market.