October 22, 2024
New Delhi, India
Zomato
Zomato’s board has approved a proposal to raise ₹8,500 crore through a qualified institutional placement (QIP) of shares to strengthen its cash reserves amid increasing competition from rivals Swiggy and Zepto. The Gurugram-based food and grocery delivery giant, whose cash balance dropped from ₹14,400 crore to ₹10,800 crore since its 2021 IPO, aims to maintain a level playing field in a highly competitive market.
Expanding Beyond Food Delivery
Zomato has been broadening its services, acquiring Paytm’s events ticketing business for ₹2,014 crore in August, and seeing massive growth in its quick commerce platform Blinkit. In the September quarter, Zomato’s net profit surged fivefold to ₹176 crore, driven by growth in Blinkit and Hyperpure, its restaurant supply chain business.
Also Read: Paytm Q2 Results: Posts ₹930 Crore Profit on Ticketing Business Sale; YoY Loss without Gains
Strong Performance from Blinkit
Blinkit, acquired by Zomato in 2022, posted a 129% revenue increase to ₹1,156 crore, with 791 dark stores operational. The platform also saw a rise in average order value to ₹92.9 and gross order value to ₹6,132 crore.
Competitive Landscape
This fundraise comes as Swiggy prepares for a $1.25 billion IPO later this year and Zepto, which has raised over $1 billion, continues to expand its grocery delivery service. Zomato emphasizes that the capital raised will be used to strengthen its balance sheet, not for acquisitions or minority investments.
Latest Q2 Results
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