Cult.Fit IPO

Cult.Fit is India's largest fitness platform, with 708 centres spread across 77 cities as of March 31, 2026. It also has a clear lead in the organised fitness market. In FY25, its revenue was 14 to 18 times higher than its nearest competitor, giving it strong brand recognition and a significant competitive advantage.

The company follows an asset-light model, which means franchise partners bear the upfront cost of setting up new fitness centres. This allows Cult.Fit to expand quickly without investing heavily in new locations itself. In FY26, 75.86% of the new centres added to its app were franchise-owned, helping it earn recurring platform and management fees while keeping its balance sheet relatively light.

The company has built a loyal subscriber base that keeps coming back. In FY26, around 85.30% of Cultpass members opted for 12-month memberships, up from 72.93% in FY24. Its annual member retention rate, which shows how many customers renew their memberships, also improved from 40.85% to 50.88%. This gives the company a more stable and predictable stream of subscription revenue.

Cult.Fit's financial performance has improved sharply as the business has grown. Better cost control helped reduce its consolidated loss from ₹888.49 crore in FY24 to ₹251.86 crore in FY26. During the same period, its Adjusted EBITDA margin (a measure of operating profitability before certain expenses) also turned positive, improving from negative 15.13% to positive 8.41%.

Cult.Fit's fitness centres also help it sell more products. Existing and former gym members accounted for 31.75% of its total product revenue in FY26 by purchasing activewear, shoes, and fitness equipment. Selling more products to existing customers reduces customer acquisition costs and increases their lifetime value, meaning the total revenue earned from a customer over time.

The company uses its own technology to run operations more efficiently. Its in-house AI Control Tower uses CCTV footage and artificial intelligence to monitor gym cleanliness and safety, while centrally managed class scheduling helps improve attendance across centres. As a result, the class cancellation rate remained extremely low at just 0.71% in FY26.

Even though the company has grown its revenue strongly, it is still making losses. In FY26, it reported a consolidated net loss of ₹251.86 crore. Some of its key subsidiaries are also loss-making. For example, Cultsport Private Limited reported a net loss of ₹180.03 crore in FY26.

A large part of the company's revenue comes from just a handful of locations. In FY26, fitness centres in India's top four cities contributed 90.44% of its total services revenue. This means any major disruption, such as natural disasters, political unrest, or regulatory changes in these cities, could have a significant impact on its business.

The company operates all its fitness centres, warehouses, and offices from leased properties instead of owning them. As of March 31, 2026, it had total lease liabilities (future rent commitments) of ₹889.13 crore. If rents increase sharply or lease agreements cannot be renewed on favourable terms, its operations and profitability could be affected.

Franchise-operated and marketplace gyms made up 69.21% of its network as of March 31, 2026, and contributed 32.53% of its total revenue. Since these centres are run by third-party partners, the company has limited control over their day-to-day operations. Any issues related to hygiene, safety, or service quality at these locations could damage the Cult.Fit brand.

The company imports fitness equipment and active footwear from overseas suppliers, including China. This exposes it to currency fluctuations and geopolitical risks. For example, a 1% movement in foreign exchange rates would have affected its profit by around ₹0.15 crore in FY26.

Fitness activities naturally involve some risk of injury. In the past, some customers have filed legal complaints against the company's trainers and managers, alleging injuries during gym sessions. Any serious injury or widely reported incident could attract regulatory scrutiny and harm the company's reputation.