Makeup manufacturer, Sugar cosmetics has “witnessed tremendous growth” and aims to be present in 100,000 stores by end of financial year (FY) 2024, co-founder and CEO, Vineeta Singh told FE.
She, however, did warn that the company would work on that number only after it reaches 60,000 stores by end of FY23 and sees no sort of growth stagnation.
The brand’s products currently sell in about 40,000 stores and Singh is gunning to be India’s number one beauty product company, overtaking Lakme and Maybelline, in another five years.
“We’ve become ambitious and think we have it in us to aim to be India’s number one makeup brand. It is difficult to say when we’d hit that mark because the market is growing rapidly but internally we’re working to reach that in five years,” Singh said.
“We are currently at a run rate of Rs 550 crore per annum and to be the leader we need to grow about three times from here,” she added.
The company’s gross merchandise value (GMV) stands at Rs 45 crore per month, while its net annual recurring revenue (ARR) is about Rs 380 crore. Sugar’s average order value (AOV) stands at Rs 1200.
Singh said her company’s revenue will double to about Rs 1100 crore in the next 12 months.
While capturing the Indian market is at the core of Sugar’s expansion plans, L Catterton – its investor that led the Series D round – will help the company expand to newer markets abroad as well.
Sugar has already launched in the Middle East and is now stepping up its presence in the United States, too. In the US it currently sells online only but will open physical stores by next year. The company wants to focus on those two regions for the next two years before it makes customised products available for other regions. Its revenues from international market will remain below 10%.
Locally, it aims to double its store count to 200 in the next year.
Asked on the initial public offering (IPO) plans, Singh said it was planned for two-three years from now but there no work was happening on that front yet. The goal “is to definitely become profitable by FY24” and then give a strategic exit to investors and generate wealth for the employees soon after.
The company has raised over $85 million so far, including $50 million from its Series D round which values the company at about $500 million. Sugar might also consider another pre-IPO round to fund its “aggressive expansion plans” but was sufficiently capitalised for its needs for a while, Singh concluded.