RENTOMOJO: TURNING RENTALS INTO A GROWTH ENGINE 🏠

RENTOMOJO What if owning furniture becomes optional? As urban lifestyles evolve, more consumers are choosing flexibility over buying everything they use. Rentomojo is building a business around this shift. Rentomojo operates a furniture and appliance rental platform, allowing customers to subscribe to products such as beds, sofas, wardrobes, refrigerators, washing machines and air conditioners. Its business model is built around recurring rental income, product reuse and customer subscriptions. And Q2 FY27 showed strong revenue momentum. Q2 FY27 consolidated performance: Revenue: ₹142.1 crore, up 52.8% YoY. Operating profit: approximately ₹22.3 crore, up 50.3% YoY. Operating margin: approximately 15.7%. Reported PAT: ₹18.2 crore, down 62.6% YoY. The PAT decline needs context. Q2 FY26 included an exceptional deferred-tax credit of approximately ₹32.8 crore. Profit before exceptional items and tax actually increased 52.2% YoY to ₹24 crore. What makes the model interesting? Recurring revenue: Subscription rentals can create predictable monthly cash flows. Asset reuse: Products can potentially generate income across multiple rental cycles. Urban demand: Students, young professionals and relocating families may prefer renting. Cross-selling: Customers renting one product can gradually subscribe to additional appliances and furniture. The business flywheel: More customers → More subscriptions → Better asset utilisation → Repeat rentals → Higher revenue. But the model has challenges. Furniture and appliances require upfront capital, while depreciation, maintenance, logistics, damage, customer acquisition and financing costs affect profitability. The company must also maintain high utilisation and manage product recovery efficiently. The real opportunity is turning physical assets into recurring subscription income.