Medkart raises Rs 40 cr in Series A co-led by Alkemi, Insitor Partners

Having grown from scratch to 75 stores, predominantly in Gujarat, Medkart plans to use the funds for expansion to touch 250 stores by 2023

One of the leading retail chains of generic medicines, Ahmedabad-based Medkart has raised Rs 40 crore in a Series A round, co-led by Alkemi Growth Capital and Insitor Partners.

Having grown from scratch to 75 stores, predominantly in Gujarat, apart from presence in Rajasthan and Maharashtra, Medkart plans to use the funds for expansion to touch 250 stores by 2023. Apart from Alkemi and Insitor, the round saw participation from angel investors including Prashant Poddar and other professionals from UAE and ex-CEO of IIFL Asset management. Mumbai based Investment Bank, Radix Capital Advisors acted as an exclusive financial advisor for Medkart.

Founded by Ankur Agarwal and Parasharan Chari in 2014, Medkart makes WHO GMP certified generic medicines at some of the most affordable rates available across its network of more than 75 stores.

Commenting on the fundraise, Chari said "This funding will help us continue to strengthen infrastructure necessary to provide a seamless omni-channel experience to our customers. For us, the unicorn status will be achieved when Medkart has helped its customers save $1 billion in their medical expenses."

According to Agarwal, the company largely procures from generic manufacturers to ensure quality as well as better margins while offering affordable rates for customers. As a result, the company has been able to reduce costs for customers by as much as 85 per cent, saving more than Rs 200 crore for its customers over the years with a loyal base of more than 600,000 chronically ill patients.

"Considering medicines is a staple need especially for chronic patients, we aim to disrupt the way medicines are being consumed in India. Being a technology enabled company, we always aim to service our customers at whichever channel they are comfortable with," said Agarwal.

So far, Medkart has seen one of the highest adoption rates in the industry of 95 percent from branded medicines to quality generics, along with a large repeat revenue profile resulting in around 85 per cent revenue coming from repeat business. The company has so far focused on building a robust supply chain and improving end delivery to customers.

Medkart achieved a break even last year even as it clocked a topline of Rs 25 crore in financial year 2020-21.

Going forward, the company is now looking at a growth rate of 25-30 per cent on the back of the Series A round.

"In the initial phase of our expansion, we will focus on building presence in Gujarat and Rajasthan since retail is a geography centered business. In the second phase, we will focus on other states starting with Maharashtra. While industry data is unavailable, the generics medicines market is big enough to occupy multiple players to help reduce medical costs," said Agarwal, while adding that among its competitors are Jan Aushadhi stores as well as Mumbai-based Zeno Health, among others.