Zomato IPO is going to make its debut on July 14, 2021. The Zomato private Ltd. company has set the offer price for its initial public offering at ₹72-76 a share. The issue will open for subscription on 14 July and close on 16 July, as per the earlier announcements.
The issue includes a fresh issue of ₹375 crores and an offer for sale of ₹9,000 crores by Zomato’s current promoter Info Edge India Ltd. Employee reservations were kept at 6.5 million shares.
Zomato is a tech-driven food aggregator platform that connects customers, restaurants, and delivery partners, serving their multiple needs. It is the first major startup in India to get listed on the stock exchange. The company is paving the route for many other such listings in the future.
The food-tech company is raging with a massive rise in revenue across the business verticals over the past few months. The company has clocked ₹1,367 crores in revenues for the first three-quarters of FY21. The expenses of the food-tech company, were about ₹1,724 crores in an evaluation, resulting in a loss of ₹684 crores.
What are the numbers telling us?
Zomato saw a rise in the number of orders placed on their platform from 3.06 cr in FY18 to 40.31 cr in FY20 and 15.52 cr in FY21. The average order value has also increased from ₹279 in FY20 to ₹398 in 9MFY21 and the discounts have seen a massive cut per order from ₹21.7 to ₹7.3 in 9MFY21.
As of December 31, 2020, Zomato had 3,50,174 active restaurants listed on its platform. In terms of table bookings, 12.2 million covers were booked through its platform in fiscal 2020. As per the official records, Zomato had 131,233 active food delivery restaurants every month, in fiscal year 2020.
It is fair to say, that the numbers are working in Zomato’s favor as the AOV has increased, discounts have decreased and per unit, economics are looking good in 9MFY21. However, the improvements in the respective metrics are because of the transition of the delivery sector from luxury to necessity.
Despite great numbers, not everything is going great for Zomato, as NRAI has filed a lawsuit against the food-tech company. Also, the NRAI has stepped up the pressure against aggregators by announcing their own app. The emergence of new-age aggregators such as Thrive, Peppo, DotPe, etc will give a tough competition. Even, Amazon is also opening itself for the food delivery business in Bangalore.
Zomato is eyeing an increase in valuation for its upcoming IPO from around $8 billion to up to $10 billion. This increase is due to the rapid increase in online food-ordering, restaurant bookings, and subscriptions for Zomato Pro businesses. Which is causing a significant increase in demand from potential investors for Zomato’s shares.
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