The marketplace of innerwear and comfort wear of Indian men witnessed a radical change with the emerging trend of the new-age Direct-to-Consumer (D2C) startups. XYXX and DaMENSCH are among the leading players driving this change, and both have been keen on product innovation and brand-based expansion to win over market share.

Both companies have consequently been able to grow their operations substantially according to the recent financial data concerning the fiscal year 2025. Although this is an impressive growth in revenue, bottom-line profitability remains a significant challenge to these high-growth brands.

Operational revenue growth

During the fiscal year 2025, XYXX became the first in terms of growth pace and overall size in relation to the nearest competitor, DaMENSCH. XYXX registered a high growth of 46% in its operating revenue with an increase in the operating revenue to ₹187 crore in FY25 as compared to ₹128 crore in the past fiscal year. Comparatively, DaMENSCH also experienced positive growth as its revenue grew by 34% to ₹118 crore.

Although both companies have experienced growth, the difference in their scales is still significant, as XYXX currently produces about 1.6 times the income of DaMENSCH. Although these two brands have gained significant presence in the market, other operators, such as Bummer, are still operating at a much lower scale. Bummer recorded a 22% growth in revenue, which will hit ₹11 crore in FY25, meaning that it is still in its early growth stage compared to the scaled operation of XYXX and DaMENSCH.

Financial performance and path towards profitability

The difference in cost structures between these brands is a significant factor affecting their financial performance of these brands. XYXX, which operated on a larger scale after its scale, had been experiencing a much higher cost of raw materials at ₹99 crore. DaMENSCH incurred expenditure of ₹69.5 crore in raw materials. One of the factors that has contributed to XYXX’s aggressive scaling is its massive investment in brand visibility. FY25 saw the company incurring expenses of ₹50 crore on advertising as compared to the ₹27.5 crore incurred by DaMENSCH on advertising and promotion.

Although the scale of revenue at DaMENSCH was lower, employee benefit expenses were reported to be higher at ₹29 crore as compared to XYXX, which recorded lower workforce costs at ₹26 crore. The similarity in expenditure was observed in the amount of commission expenses that both companies incurred within the range of ₹14 crore to ₹18 crore. Considering the total expenditure, the total expenditure of XYXX was in the financial year of ₹217 crore, whereas DaMENSCH’s expenditure was ₹178 crore.

Even though both companies were still incurring losses in FY25, they have different trends in their efforts to reduce the losses. XYXX is a company that showed a better increase in its financial performance by decreasing its net loss by 28%. Its losses declined to ₹25.5 crore during FY25 compared to FY24. This has also been improved in its expense-to-operating revenue ratio, which stood at 1.16, indicating that the company is fast approaching a break-even point as it expands.

DaMENSCH experienced a small reduction in its losses that shifted from ₹60 crore in FY24 to ₹57 crore in FY25. It has a high expense to operating revenue ratio of 1.51, which implies a higher burn rate than its revenue. The two companies have a sharp difference in terms of asset positions; XYXX registered current assets of ₹161 crore, which is quite high compared to the current assets of ₹66 crore registered by DaMENSCH. The smaller competitor Bummer recorded its loss to increase to ₹4 crore in the same period, which indicates how hard smaller D2C brands find it to balance out the growth and the increasing costs.

Conclusion

XYXX and DaMENSCH FY25 financial performance indicate that the D2C innerwear market is going through a time of high growth and contraction. Though XYXX has been able to leap ahead of its competitors in terms of revenue growth and reduction in loss, the wider industry pattern indicates that this competitive sector needs huge capital input, especially in advertising and raw materials, to scale.

With these brands still competing over innovation and brand loyalty, the next few years will decide whether this scale of increase can be finally transformed into sustainable profitability.