Zomato eyes $1.3b IPO
Indian food delivery giant Zomato announced plans on Thursday to raise 93.75 billion Indian rupees ($1.3 billion) via an initial public offering, the latest firm to take advantage of a strong rally in local equities.
Zomato and rival Swiggy - both of whose delivery riders are ubiquitous in Indian cities - are the two biggest players in a food delivery market forecast to explode in the coming years.
But Zomato Co-founder Gaurav Gupta said the Indian market was still “highly under-penetrated” with only 8-9% of food consumption from restaurants, compared with 40-50% in markets such as China and the United States.
“We are disrupting the Indian habit of home-cooked food and we are very excited about the opportunity ahead of us to drive this kind of behaviour,” Gupta told reporters. Both Zomato and Swiggy are, however, yet to be profitable because of high start-up and marketing costs. In the last financial year, Zomato lost 8.16 billion Indian rupees on revenues of nearly 20 billion rupees.
Published in The Express Tribune, July 9th, 2021.
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