November 29, 2024
New Delhi, India
Zomato Secures ₹8,500 Crore Through QIP at ₹252.62 Per Share
In a significant fundraising milestone, Zomato has raised ₹8,500 crore through a Qualified Institutional Placement (QIP). The company issued 33.65 crore equity shares at ₹252.62 each, reflecting a 5% discount to the floor price of ₹265.91. This marks Zomato’s first major fundraising effort since its Initial Public Offering (IPO) in July 2021.
The QIP concluded on November 28, 2024, following strong demand from institutional investors. Proceeds from the issue will primarily be directed toward establishing dark stores and warehouses, with ₹2,137 crore allocated to these operations. The company aims to strengthen its foothold in the food delivery and quick commerce sectors.
Additionally, Zomato plans to deploy funds for advertising and marketing to bolster its competitive position. CEO Deepinder Goyal reiterated that this fundraising would support the company’s balance sheet and future growth initiatives. Notably, Goyal extended his salary waiver through March 31, 2026, underscoring his commitment to the company’s success.
Stock Performance and Market Inclusion
Zomato’s stock closed at ₹285.20 on November 28, marking a 145% surge over the past year and propelling its market capitalization to ₹2.4 lakh crore. Its recent inclusion in the National Stock Exchange’s Futures and Options (F&O) segment is expected to enhance stock liquidity and attract broader investor participation.
The company is also slated to join the BSE Sensex index from December 23, further cementing its presence in the market.
New Initiatives: The ‘District’ App
To diversify its offerings, Zomato recently launched a new app, District, aimed at providing a comprehensive platform for dining out and entertainment activities. Initially focusing on restaurant bookings and ticketing, the app plans to expand into other segments, tapping into a supply-constrained market. Analysts believe this initiative could open up new revenue streams and give Zomato a competitive edge.
Rising Competition in Quick Commerce
The quick commerce space remains fiercely competitive. Rivals such as Zepto and Swiggy are scaling their operations aggressively. Zepto plans to operate over 700 dark stores by FY25, while Swiggy Instamart is targeting an expansion to 741 dark stores, up from 557 earlier this year.
Zomato’s QIP strengthens its strategic position in this competitive landscape, enabling it to maintain parity with its peers and continue its growth trajectory.
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