NEWJAISA

NEWJAISA faced a significant challenge in February 2025 when Amazon stopped selling refurbished products on its Indian platform, causing the company's monthly revenue run rate to drop sharply from ₹6 crores to ₹1.8 crores. In response, the company focused on rebuilding sales channels, recovering almost 75% of the lost revenue in H1 FY26 by expanding its own web channel (newjaisa.com) and B2B/enterprise segments. The web channel's monthly run rate grew 4X from ₹50-60 lakhs to over ₹2.5 crores, while B2B revenue also saw a 4X increase from under ₹1 crore to over ₹4.5 crores in Q1 FY26.

To mitigate the financial impact, NEWJAISA implemented aggressive cost control measures, including a workforce reduction of over 40% within 2-3 months, leading to an approximate 70% drop in employee costs. Despite these efforts, the company's capacity utilization fell to about 40%, and it anticipates remaining "in red" for the full fiscal year due to ongoing investments in marketing and channel development. Management expects to achieve full capacity utilization within a year.

The company adopted a conservative approach to inventory, writing off older generation RAMs, hard disks (DDR3, DDR4), and laptops (3rd, 4th gen). While inventory in hand was reduced by ₹5 crores, concerns were raised by analysts regarding the adequacy of write-offs given the total inventory value of ₹35 crores. Management clarified that 10-15% of inventory still comprises 6th generation and below assets, but their focus is on 7th, 8th generation and above, and they will provide an inventory aging report next quarter.

Following the transition from Amazon, NEWJAISA experienced customer support challenges, with complaints about unreachability and slow resolution times. Management attributed this to building an in-house support team and capacity after Amazon previously handled it. They have since implemented Salesforce and opened phone support in the last 20 days, noting a significant reduction in complaints and an improvement in positive feedback, with a current rating of 3.8-4.3+ out of 3,800 comments.

NEWJAISA received the R2 international accreditation, a certification held by only five companies in India, which enables direct procurement and partnerships with large corporates and multinationals. This strategic move is expected to accelerate direct purchases, with management targeting at least a doubling of direct procurement in H2 FY26. The company also expanded its retail presence by securing a new tie-up in a southern state, adding to its existing modern trade partnerships.

Management is confident in achieving a full recovery of its monthly revenue run rate to pre-Amazon levels (around ₹6 crores) by the end of 2025. They view the refurbished PC market as a large opportunity, with their current sales of ₹70 crores representing only about 10% of the India-centric PC category. They believe the market needs more players to build awareness and confidence, and do not see competitors like GTG as a direct threat, but rather as validation of the model.