Fitness startup Cult.fit is aiming for an Initial Public Offering (IPO) in 12-18 months as its core gym business has turned in an operating profit, a senior executive said.
Cultfit’s revenue had also grown more than 50% compared to pre-Covid-19 levels, Naresh Krishnaswamy, business head, told ET.
“The two businesses – our fitness and fitness products business – will lead the charge for Cult.fit over the next 12-18 months as we look towards turning completely profitable at an Ebitda level and as we look towards our IPO event in the next 12-18 months,” Krishnaswamy said.
Ebitda refers to a company’s earnings before interest, taxation, depreciation and amortisation.
The company – which counts Tata Digital and Zomato as investors – is doubling down on its core fitness and fitness products business for now, he added.
“Other businesses like Mind.fit and some of our wellness categories like diagnostics have been put on the backburner; we are a lot more focussed on these two businesses and we want to get these two businesses near to profitability before we invest in any third or fourth business,” he said.
The company has also spun off its Care.fit business into Sugar.fit, which he said was doing “extremely well” in the diabetic care space.
Cult.fit’s operating revenue was around Rs 161 crore in FY21.
The company’s CFO, Bishnu Hazari, told ET that FY22 revenue would be in a similar range on account of the pandemic. However, the company is forecasting higher revenue in the ongoing financial year with business increasing 50% compared to pre-pandemic levels. It was valued at $1.5 billion following Zomato-led $145 million funding round in December 2021.
Cult.fit,which was earlier known as Cure.fit, has made 14 acquisitions over the last few years, including in-home fitness equipment businesses like RPM fitness and Fitkit.
It acquired a majority stake in F2 Fun & Fitness, becoming the master franchise partner for Gold’s Gym in India. The company said the integration with Gold’s Gym is complete and 40% of gyms are part of the company’s loyalty programme called Cultpass.
“All of the businesses have been integrated into our core business,” he said. “They have all added different flavour and capabilities to our overall business. For example, Fiternity kick-started our marketplace business and it was in the business of listing gyms.”
Cult.fit has begun expanding again in non-metro markets after withdrawing from these during the pandemic. It currently operates in about 40 cities compared to 25 cities pre-pandemic.
In total, Cult.fit has more than 600 facilities, of which more than 200 centres are operated by the company.
The company – founded by Mukesh Bansal and Ankit Nagori – fired a significant chunk of its employees amid the two main Covid-19 waves and moved to a franchise-owned model for its offline centres.
In May 2020, it laid off over 800 employees, or about 10% of its workforce.
Bansal and Nagori undertook a significant restructuring of the firm in 2020, making its cloud kitchen business an independent entity. Nagori now runs this business as Curefoods.