Cult.fit’s IPO promises to lift heavier weights, but can it?

**Akshara** (0:03)
In today's episode, we'll break down two important stories. First, we'll talk about whether Cult.fit's IPO can lift heavier weights, and then we'll talk about how AI is eating the web that feeds it. Welcome back to The Daily Brief by Zerodha, where we cut through the noise to help you understand what's actually happening in the most important stories from business and markets. If you're listening to this on your commute, on a walk, or at the gym, you can also find The Daily Brief as an audio podcast on Spotify, Apple Podcasts, or wherever you listen to your podcasts. If you prefer reading, check out the newsletter using the link in the description. I'm your host Akshara, and today is Monday, 13th July. Coming to the first story.
So for most of its life, Cult.fit has worn a convenient label of being fitness tech. It's an app with lots of data about customers, and apparently even an AI that decides where to open the next gym.
Maybe Omnichannel Fitness Platform is a better description. But labels aren't all that useful in understanding nuances of running and knowing a business. So here's a number that cuts through this one. As of March 2026, Cult.fit employed 6,331 people. Of them, 3,529 were trainers, and another 1,665 ran its centers. The number working in technology and product was just 125
That ratio is the company. Cult.fit is clearly a gyms business with some software bolted on with a physical operation of leases, trainers, floor space, and treadmills. It makes Cult.fit a more interesting company to understand because a brick-and-mortar business has brick-and-mortar economics. Rent, utilization, footfall, whether people actually show up. The app layer, meanwhile, affects all these things in weird but intuitive ways. So instead of asking whether the IPO is cheap or dear, let's do something more useful. Let's understand the business from the floor up and ask the questions that decide whether it works. So Cult.fit is really two companies under one brand. The first is fitness services subscription with gym access, group classes, personal training, sports, at-home workouts, sold mostly through CultPass memberships. In FY26, this brought in about Rs 1198 crore or roughly 70% of revenue. The second is products like activewear, footwear, treadmills, massagers, accessories, sold through its own stores, its app or e-commerce marketplaces.
That was about Rs 523 crore. Obviously, services is the more predictable business. Members pay up front, come back ideally, and can be upsold over time. The product side is closer to a retail operation, stitched on to a fitness brand. So this IPO is primarily a bet on the services engine. The company might have you believe that you're buying the whole integrated ecosystem, but the ecosystem as a whole still has much left to prove. And we'll get back to this eventually. Now, the setting at least is promising. India's organized fitness market, which includes branded gyms rather than neighborhood setups, is estimated at only about 12% of the fitness services market and expected to reach 17-19% by 2030 And fitness center membership runs to roughly 1% of the population. So what remains to be answered is whether Cult.fit can gain the most from the potential that exists. And more existentially, does India even go down this trajectory in the first place? So every gym membership is a small bet against human nature. People sign up in January full of intent, only for disappointment to set in a few months later, and the treadmill is empty out by April. So an important number in this business is whether members renew. It's easier to get the existing already fit customers to stay than actually finding new people who want to get fit. And these renewals are what makes subscription model viable.
So here, Cult.fit has an improving story. Its retention rate climbed from approximately 41% in FY24 to approximately 51% in FY26.
That's progress, but hard to describe in absolute terms of it being good or bad. Now we can also read it the other way. Roughly half its members don't renew. So it might be better than a typical local gym, but a long way from the stickiness of a software subscription. Now what makes the improvement believable is where it's coming from. Marketing spend, which is what a business would burn to keep replacing the members it loses, has fallen sharply from approximately 20% of revenue in FY24 to 10% in FY26. And over the same stretch, approximately 39% of new paid members came in through referrals. And that's an encouraging signal that the brand needs less paid ads to build a reputation. Personal training also points the same way. It grew 73% in a single year to rupees 122 crore and is now a tenth of services revenue. That's a company deepening its grip on existing customers rather than endlessly chasing new ones. But it's far more difficult to say, this is evidence of large-scale habit formation.