Urban Company’s board approved a proposal to raise up to ₹2,500 crore to strengthen its financial position, according to inc42.com. The decision comes amid rising losses driven by its instant home services business, InstaHelp, and plans to expand into the residential air conditioner market under its Native brand.
The company’s Q2 FY27 financials reveal a consolidated revenue growth of 41.4% year-on-year to ₹537.3 crore, but expenses surged 61.5% to ₹745.7 crore, resulting in a consolidated net loss of ₹182.5 crore, more than triple the ₹59.3 crore loss from the previous year. InstaHelp’s ₹174 crore investment contributed heavily to an adjusted EBITDA loss of ₹144 crore, while excluding InstaHelp, the company reported an adjusted EBITDA profit of ₹30 crore. Despite this, management stated the fundraise is not essential to offset InstaHelp’s losses.
Urban Company faces intense competition in the instant home services segment from rivals Snabbit and Pronto, making customer acquisition costly. The company’s core consumer services remain stable, but the strategic move to enter the residential air conditioner market signals a diversification effort. The proposed fundraise aims to bolster the company’s war chest at a critical juncture, reflecting broader market pressures and the need to support growth initiatives.
Urban Company’s board approved the fundraise proposal yesterday, marking a significant capital-raising effort as the company reported these results for Q2 FY27. The management continues to assert confidence in meeting profitability targets without relying solely on the new funds.