Zoomcar Holdings - Earnings Call - Q4 24/25

Transcript

Anirudh Lamba (Head of Marketing and Partnerships)

Upcoming events and our expectations regarding the company's business and financial performance. Each time we do, we will try to identify these statements with words such as expect, believe, anticipate, or other words that identify potential events. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those stated in the forward-looking statements. Please consider the forward-looking statements contained in the earnings press release issued this morning on June 30, 2025, and stated during this conference call, as well as the risk factors and uncertainties described in our annual and quarterly filings with the U.S. Securities and Exchange Commission. During our presentation, we may discuss or disclose non-GAAP measures. These non-GAAP measures are not intended to replace the presentation of our financial results in accordance with U.S. GAAP.

The presentation of non-GAAP information is intended instead to provide additional information to investors to facilitate the comparison of past and present results. Any forward-looking statements we make today are based on assumptions which we believe to be reasonable as of today. We undertake no obligation to update these statements as a result of future events. Please refer to our SEC filings for a detailed understanding of these risk factors. With that, let me hand it over to our CEO, Deepankar Tiwari.

Deepankar Tiwari (CEO)

Thank you, Anirudh. Hello, everyone, and thank you for taking the time to join us today. I am pleased to report that fiscal year ending March 31, 2025, has been a milestone year for Zoomcar. We close the fiscal year with a contribution profit of $4.25 million compared to a loss of $0.98 million incurred during the fiscal year ending March 2024. This also marks our sixth consecutive quarter of positive contribution profit, a clear signal that our model is working. Our booking numbers grew 10% year over year, but we are especially encouraged by the quality of that growth. Repeat users grew by a significant 86%. Today, of all the users booking our car on our platform, 13% of them are booking it more than once, which is much higher than the 7% that they were in the previous fiscal year.

Also, the high-quality host retention, that is, hosts who are rated 4.5 plus on a scale of 5, jumped up by almost 58% to 49% of the total hosts onboarded on the platform during the current fiscal year ending March 31, 2025, as compared to only 31% hosts during the previous comparable fiscal year. This points to a strong platform loyalty on both sides of the marketplace. Our focus this year has been very clear: improve the customer experience, drive host retention, and deliver on both revenue growth and profitability. We have made progress on all fronts. Our average guest rating climbed by 13% to 4.7 on a scale of 5 during the current fiscal year ending March 31, 2025. We continue to optimize costs through dynamic pricing, smarter incentives, and operational improvements and efficiencies. Next slide.

We focused heavily on improving customer experience on both sides of the marketplace, both for guests and hosts, because this drives retention and profitability. Some key initiatives include doubling our customer support capacity, deploying GenAI tools for faster resolution, rolling out machine learning-driven dynamic pricing and loyalty programs, and increasing high-quality supply through partnerships and fulfillment centers. These efforts have led to our repeat user rate growing by 86% year over year and high-quality host retention growing by 58% year over year. Next slide. During the fiscal year 2024-2025, we saw a sixth straight quarter of positive contribution margins. Our focus on customer experience and operational leanness continues to pay off. We are seeing encouraging improvements in both retention and the booking quality.

I now hand over to our Chief Financial Officer, Sachin Gupta, to provide an update on our fundraising efforts and the financial results for the fiscal year ending March 31, 2025.

Sachin Gupta (CFO)

Thank you, Deepankar. Thanks, everyone, for taking time out today for this earning call of Zoomcar. We successfully raised $16.5 million in gross proceeds during the fiscal year ending March 31, 2025, through private placements. These proceeds are being strategically deployed towards debt repayment and supporting business growth. Additionally, we used our $30 million private placement round to settle outstanding liabilities and resolve key litigations, positioning the company on a stronger financial footing. This has set the stage for an accelerated growth as we secure further capital. We are actively pursuing additional fundraising over the next few quarters and are also engaged in ongoing discussions to restructure our remaining debt with the aim of reducing near-term cash flows and improving the long-term financial sustainability of the business. Over the next slide, I'll let me take you through the key operational and financial matrix.

All the numbers presented here are for the fiscal year ending March 31, 2025, as compared to the fiscal year ended March 31, 2024, unless otherwise mentioned. Our bookings were approximately $427,000 for the fiscal year ended March 31, 2025, as compared to a total booking of $388,000 for the previous comparable fiscal year, representing a 10% year-over-year growth. Our gross booking value stood at $25.28 million for the fiscal year ended March 31, 2025, compared to $26.72 million for the previous comparable period. Revenues came in at $9.11 million compared to $9.99 million in the previous year, while our loss from operations declined significantly by 67% to $10.4 million, down from $31.67 million in the prior fiscal year.

One of the key highlights has been our contribution profits, which significantly improved to $4.25 million for the fiscal year ended March 31, 2025, versus a loss of $0.98 million for the previous fiscal year ended March 31, 2024. This significant improvement underscores the strength of our underlying business fundamentals. To provide a perspective, what this means is that our contribution margin was 47% of the net revenue for the current fiscal year ended March 31, 2025, up from a negative 10% of revenue during the fiscal year ended March 31, 2024. In absolute dollar terms, what we have achieved is approximately $10 for every booking served by our platform during the current fiscal year, whereas we were losing approximately $2.50 for every booking served by the platform during the previous fiscal year.

That's almost an improvement of $12.50 for every booking served from previous fiscal year to current fiscal year. Our adjusted EBITDA loss also narrowed down to $9.91 million compared to $17.85 million in the fiscal year ended March 31, 2024. In the next slide, we would like to draw your attention to adjusted EBITDA, another non-GAAP metric, which the management believes provides an understanding of how the company has been performing and also provides an insight on the overall operating efficiency the company has been able to achieve across the organization. Our adjusted EBITDA continues to show an upward trend. This improvement reflects stronger contribution margins, cost control, and a path to profitability, which is achievable in the near term.

The next couple of slides, slide 11 and 12, provide a detailed GAAP to non-GAAP reconciliations for both the non-GAAP matrix, which the management believes provides an understanding on how these matrix are arrived at. These non-GAAP matrix should be read in conjunction with the other U.S. GAAP matrix, which will be reported by way of 10-K filing, which will be filed later in the day today. These six matrix, which are highlighted here, reflect the transformation we have executed over the past year. We've improved bookings, strengthened host retention, doubled our repeat usage rate, and turned contribution margins significantly positive for each booking or guest served. All of this while cutting across operational losses significantly across the organization. The turnaround was not accidental. It's a result of disciplined execution and sharper focus on profitability. We are not stopping here.

The foundation is now set, and our next phase is about scaling this model through a higher quality supply, smarter demand generation, and deeper platform trust. What excites us is how replicable this playbook is. If FY 2025 was the inflection point, FY 2026 is where the compounding begins.

Anirudh Lamba (Head of Marketing and Partnerships)

Thank you, Sachin. We'll now move to the question and answer section of today's session. Over the past few days, we have received a number of questions from our shareholders and analysts. We have reviewed and consolidated the most commonly asked ones, and we'll take a few moments now to address them directly. These cover key areas around performance, strategy, and what's ahead for Zoomcar. The first question is for Deepankar. Deepankar has been a part of the mobility industry in India for more than two decades, first with Tata Motors and then with Uber, both of which are mobility giants. Deepankar, what propelled you to join Zoomcar as the CEO?

Deepankar Tiwari (CEO)

Thanks, Anirudh. So I've known Zoomcar and its founding team since their inception back in 2013. And I'd also had the opportunity to partner with Zoomcar during my time at Tata Motors and Uber Technologies over the years. So thus, I've known the company well from the outside. But more importantly, I deeply believe in the mission that Zoomcar is undertaking, which is to bring access to personal mobility to India's young demographics. In India, there is a cultural shift that is happening, which is to be more experiential in nature rather than being an owner. And now, with greater disposable incomes, the trend lines are very clear. Access to personal mobility is deeply required, while ownership of cars is not necessarily so. So this is where our marketplace fits in perfectly, rather uniquely.

I see a huge headroom of growth for Zoomcar in India and subsequently in other emerging markets. Seeing all this, I'm very excited to be part of the growth story of Zoomcar and be part of this journey. That's what, in short, propelled me to be part of this great story.

Anirudh Lamba (Head of Marketing and Partnerships)

Thanks, Deepankar. I think the next one is for Sachin. Sachin, can you provide more details about the fundraising progress and debt restructuring?

Sachin Gupta (CFO)

Sure. We raised a gross amount of $16.5 million and a net amount of $9.5 million by way of issuance of equity shares through private placement during the fiscal year ended March 31, 2025. The primary use of these proceeds has been to repay debts and fund business growth. We are working on raising more debts to invest in the growth of our business. In addition to this, we have been in active discussions to restructure our existing debt, which includes a mix of extended repayment schedules, one-time settlements, and exploring equity-based settlements.

Now, just to provide a perspective, our total loss from operation was about $10.4 million, and our total liability reduced by approximately $12 million during the current fiscal year ended March 31, 2025, against a net fundraise of only $9.5 million, which was made possible due to extensive restructuring of the legacy debts that we have been carrying from the past. Now, we continue to pursue this in the current fiscal year as well. This, we believe, has been a significant step, which will enable us to use the planned capital raise to be extensively used to fuel the growth of the business and create long-term sustainable value for all the stakeholders associated with the company.

Anirudh Lamba (Head of Marketing and Partnerships)

Thank you, Sachin. The next question, please provide an update on your listing status and any future relisting plans.

Deepankar Tiwari (CEO)

Yeah, let me take that one. We continue to work towards relisting and are in discussions with the relevant stakeholders over the next couple of quarters. While timelines depend on market conditions and some of the regulatory approvals, this remains a key priority and a key focus area for us. We will be sharing updates as and when they start materializing.

Anirudh Lamba (Head of Marketing and Partnerships)

The next question, what are management's top priorities for the near term?

Deepankar Tiwari (CEO)

I think our priorities are very clear. One is to expand high-quality supply to meet the growing demand. We are being very focused on that. We are working to really deepen customer engagements by improving guest and the host experience on the platform. We continue to be very sharp-horned on driving profitability through cost discipline and operating efficiency. These are the three fundamental core areas that we are really focusing on. We believe that by focusing on these areas, we will position Zoomcar for sustainable growth and long-term value creation. I think that's very, very important for the company to move forward: sustainable growth and long-term value creation. Focus on these three elements is going to be our key priority.

Anirudh Lamba (Head of Marketing and Partnerships)

Is Zoomcar exploring any strategic M&A opportunities or partnerships to accelerate growth or consolidate its leadership in the Indian mobility market?

Deepankar Tiwari (CEO)

Yes, we are actively exploring multiple strategic options. As you may know, the Indian mobility space is at its pivotal inflection point, and we believe there are strong opportunities for consolidation, especially in the self-drive and asset-light mobility models. We are currently in early-stage discussions with a few prominent mobility players, which include some of our B2B fleet partners, rental platforms, adjacent ecosystem enablers, and so on. The goal is to unlock synergies in fleet utilization, in guest acquisition, and the overall shared infrastructure. We are approaching these conversations very thoughtfully, prioritizing long-term alignment and platform efficiency. Any move that we will make will be rooted in our mission to build a lean, trust-first mobility marketplace at scale. That is the thought process with which we are going ahead with these conversations.

Anirudh Lamba (Head of Marketing and Partnerships)

Thank you, Deepankar, and thank you, Sachin. Thank you, everyone who's joined. This concludes Zoomcar's FY 2024-2025 earnings call. For more details, please refer to our press release published earlier in the day, 10-K to be filed with the U.S. SEC during the day, and earnings material available on our Investor Relations site. If you have any additional questions, feel free to reach out to us at [email protected]. Have a great day.