India’s cloud kitchen sector witnessed significant revenue growth and reduced losses in FY24, driven by effective cost management across marketing and employee expenses. Despite these improvements, industry leaders remain cautious about margin pressures in FY25 due to persistent inflation.
Leading players such as Rebel Foods, Curefoods, Biryani by Kilo, and Freshmenu reported substantial gains. Rebel Foods, known for brands like Faasos, Behrouz Biryani, and Oven Story, recorded a 20% year-on-year revenue growth while cutting losses by 42%. The company also managed to reduce employee benefit expenses to Rs 394 crore from Rs 405 crore and advertising costs to Rs 133 crore from Rs 197 crore.
Curefoods, backed by Binny Bansal, achieved a 53% revenue increase while narrowing its losses by 53%. The company significantly reduced marketing expenses, spending Rs 53 crore in FY24 compared to Rs 107 crore in FY23. Similarly, Biryani by Kilo cut its advertising budget by 15% to Rs 28 crore.
Bengaluru-based Freshmenu, once on the brink of acquisition, made a strong comeback, crossing the Rs 100-crore revenue mark. The company posted a 73% increase in operating revenue to Rs 121 crore and reduced its net loss by 20% to Rs 8 crore.
Despite these successes, industry executives highlighted rising costs of raw materials like edible oil, wheat, and vegetables as ongoing concerns. Passing on these cost increases to consumers remains challenging in the competitive food services market.
On the aggregator side, Zomato and Swiggy continued their growth trajectories. Zomato’s food delivery gross order value (GOV) rose by 23% year-on-year to Rs 32,224 crore, while Swiggy reported a 15% growth to Rs 24,700 crore.
According to a report by the National Restaurant Association of India (NRAI), the cloud kitchen sector grew at an annual rate of 30-40% from 2019 to 2024, with a projected CAGR of 35% over the next four years. Industry insiders remain optimistic about sustained growth, driven by increasing demand for convenience and variety in meal options.