 "Abhiraj Singh Bhal, chief executive and co-founder of Urban Company")
Abhiraj Singh Bhal, chief executive and co-founder of Urban Company, returned to his Gurugram office just days after the home services platform's blockbuster initial public offering raised ₹1,900 crore and achieved a market capitalisation of ₹23,987 crore. The 38-year-old entrepreneur’s company became the most subscribed large IPO of 2025, receiving bids 104 times the offer size within hours of opening.
Urban Company’s public debut comes as India’s home services market—currently 99 per cent offline and unorganised—presents a ₹8.5 lakh crore opportunity by 2030. The company, which turned profitable in fiscal 2025 after years of losses, operates across 47 Indian cities and four international markets, formalising thousands of gig workers in sectors from beauty services to home repairs.
In this interview with Peerzada Abrar, Bhal discusses the path to profitability, competitive strategy, and his vision for transforming India’s fragmented home services ecosystem through technology and artificial intelligence. Edited excerpts:
Are you satisfied with Urban Company’s IPO performance, and how does the ₹23,987 crore valuation compare to your expectations? How do you view the IPO outcome compared to other major Indian startup IPOs like Zomato, Nykaa, or Swiggy?
We are very humbled and grateful for the response that we’ve got. We have a very long way to go—a lot to do, and a lot to prove. We’ll have to earn our trust in the public markets through consistent execution and performance. We’ll have to work hard, be honest and transparent in our disclosures, and help investors with all the information they need.
In many ways, it’s Day Zero all over again. It’s the start of a new journey of building Urban Company into a much larger and more impactful company in the coming 20 years. We also respect and look up to all companies that are out there, and draw inspiration from all of them.
Accel is seeing a 28-fold return from its early investment. Can you share what kind of returns founding team members and investors are realising, and how you balanced rewarding early employees through the IPO?
We’re very grateful to our early investors—Elevation, Accel, Bessemer, and Vy Capital. Elevation and Accel took a bet on the company when the company registration process itself was still underway and had not even been completed. We don’t take that for granted.
And we think very similarly of all the investors who are coming into the IPO. We had about ₹1,144.5 crore of revenue in FY25, and small profits—just about breakeven. In many ways, the investors who are taking a bet on the company today—investing their hard-earned money—are also taking the kind of bet that some of these early investors took. We are not worried about valuation. We are very clear about long-term value creation. We don’t worry about what we don’t control. To that extent, valuation is actually something that’s completely outside our control and our purview.
We have an egalitarian and broad-based ESOP programme through the lifecycle of Urban Company. I think more than a thousand employees—past and present—have been rewarded.
You turned profitable in FY25. What were the key operational changes that drove this turnaround, and is this profit margin sustainable as you scale?
Our total revenue moved from ₹437.6 crore in FY22 to ₹1,144.5 crore in FY25. If you look at that three-year period, we added about ₹707 crore of incremental revenue to the top line.
In FY25, profit after tax was ₹240 crore, but that was largely on account of a one-time accounting entry called a deferred tax asset. So the current profitability of the business was about ₹12 crore in adjusted EBITDA and about ₹28 crore in profit before tax.
The good news is that the business has turned a corner—from negative ₹385 crore in adjusted EBITDA three years back and negative ₹514 crore in PBT, it has moved into the positive, largely because of the incremental revenue we’ve added.
In our kind of business, the fixed costs—whether it’s technology, training, brand building, or user acquisition—are generally front-loaded. We have a very healthy contribution margin, so if you keep your fixed costs largely in check, you can see a meaningful percentage of the incremental revenue flowing to the bottom line. At this point in time, it’s still sort of a breakeven-stage company—small profits.
What’s your current take rate from service professionals, and how do you balance keeping them incentivised while maintaining healthy margins? Are you seeing any pushback as you’ve grown, and what is your churn rate?
We have a model where roughly a quarter of the earnings comes to us, and about three-quarters goes to the professional. Professionals earn very well on our platform. In FY25, for example, the average professional made—net of all costs—about ₹26,500 per month. Gross earnings were ₹50,000, but after removing commissions, fees, travel costs, and product costs, the actual cash-in-hand was ₹26,500.
As we densify our network and our micro-markets, service professionals spend less time travelling between jobs and less time waiting for jobs—and more time inside the consumer’s home. That allows them to earn more and be better utilised.
We’re already operating at a very healthy pace. And of course, as professionals do more work and progress in their careers, they earn a lot more. I think that transition has been a strong validation for service professionals.
Beyond income, we also offer a range of benefits. They get access to free life and accidental insurance while on the job, and health insurance that covers both on- and off-the-job incidents. We also provide access to personal and vehicle loans through our platform at attractive rates. Training is also a big part of what we do. Close to a third of our workforce is made up of women. For them, we’ve recently launched Project Udaan, a mobility solutions programme that helps them acquire two-wheelers and learn how to ride.
How do you compete against local players and new entrants who might undercut on pricing? What’s your sustainable competitive advantage beyond first-mover status?
Less than 1 per cent of the home services market is online and organised. RedSeer has estimated that this is currently a ₹5.5 lakh crore market in India, and it’s expected to grow at about 10 per cent annually. Over the next five years, it’s projected to reach around ₹8.5 lakh crore.
I really think the job to be done here, for all of us players in the space, is not to be focused on how we divide that 1 per cent among ourselves. The real task is: how do we take that 1 per cent to 20 per cent. To do that, we obviously need to innovate. We have to offer significantly better service quality, ensure greater fulfilment and availability, and deliver better value from a value-for-money standpoint. All of these elements will play a role in shifting the market from offline to online.
With ₹1,900 crore raised, what are your top investment priorities? Are you looking at international expansion, new service categories, or deeper market penetration?
About ₹472 crore is primary issuance and ₹1,428 crore is the offer for sale. The ₹472 crore from the primary issuance—we’ve identified the use of proceeds for that. The key areas include technology development and cloud infrastructure to enable better quality control and service delivery.
We’re also using artificial intelligence (AI) across all touchpoints in the service journey, and I think that’s going to be an important one. We want to invest more in training because we’ve seen very high correlation and ROI on those investments in terms of medium-term growth and customer satisfaction. We’ve also allocated some capital for marketing, brand building, and user acquisition, and then of course, some funds for general corporate purposes.
As of now, we’re happy with our international footprint. I don’t think we will expand further internationally in the near future. The focus is on growing well in the markets we’re already in, and also growing well in India.
In India, we are present in 47 cities. Globally, we are in four cities: Dubai, Abu Dhabi, and Sharjah in the UAE, and Singapore. RedSeer had mentioned in their report that a service like ours could be relevant for the top 200 cities in India. That’s something we are thinking about—gathering more information, observing traction on other marketplaces.
The addressable market for home services is estimated to be about ₹5.5 lakh crore, and it’s expected to grow to ₹8.5 lakh crore over the next five years.
We are scaling up InstaHelp. We offer trained house help workers at your doorstep within 15 to 30 minutes. It has become one of our big new focus areas.
You’ve formalised thousands of gig workers, but labour classification remains contentious globally. Are you prepared for potential regulatory changes, and what impact would that have on your company?
I think the industry is obviously still very nascent—still growing, still getting organised. By and large, I would say we’ve been a step ahead in terms of our gig workers—their enablement, earnings, training, etc. For example, we already provide insurance.
Overall, we will comply with whatever is the regulation and the rule of the land.
