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Zomato and Zepto Plan New Fundraising Through QIP

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Synopsis:

Zomato will raise funds through a qualified institutional placement (QIP) on October 22. Zepto plans to raise $100 million in fresh funding. Both companies aim to drive growth amidst competition in the quick commerce sector.

Zomato and Zepto news today

Zomato and Zepto, two key players in the food delivery and quick-commerce sectors, are gearing up to raise more capital through separate initiatives. Zomato will seek funding via a Qualified Institutional Placement (QIP), while Zepto looks to raise $100 million through a fresh funding round. These fundraising efforts come as both companies aim to expand their operations and tackle intensifying competition in their respective sectors.

ZOMATO LIMITED

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Zomato's QIP plan: what to expect

Zomato, one of India's largest food delivery platforms, has announced that its board will meet on October 22, 2024, to review raising capital through a QIP. The new capital will likely support the expansion of Zomato's ‘going-out’ division, especially after the company’s recent acquisition of Paytm’s ticketing business for ₹2,048 crore. The QIP also coincides with the company’s second-quarter results for the financial year ending March 2025, which will be released on the same day.

In its first-quarter results, Zomato reported a net profit of ₹253 crore, a substantial rise from ₹2 crore in the same period the previous year. Revenue also surged by 74%, driven largely by its quick-commerce unit, Blinkit. With rising demand for exclusive event tickets and the ongoing growth of its delivery services, the funds raised from the QIP will likely fuel Zomato’s expansion plans. As competition from Swiggy Instamart, BigBasket, and Flipkart Minutes intensifies, these funds could help Zomato stay ahead in the rapidly evolving market.

Zepto's fresh funding round: $100 million on the horizon

Meanwhile, Zepto, a fast-growing quick-commerce startup, is preparing to raise $100 million in a fresh funding round. Led by the Motilal Oswal Group, this round is set to boost Zepto’s valuation to $5 billion. Motilal Oswal has committed $40 million, with the remaining $60 million to come from domestic investors and high-net-worth individuals. This would mark Zepto’s third funding round in just four months, bringing its total capital raised in 2024 to over $1 billion.

Zepto faces tough competition from players like Blinkit, Swiggy Instamart, and JioMart. These funds are expected to help Zepto maintain its competitive edge, while ensuring steady growth in the highly competitive quick-commerce space.

With Zomato and Zepto raising substantial funds, both companies are positioning themselves for continued growth and competitiveness in their respective markets. As quick-commerce and delivery services face intense competition, these capital injections will play a crucial role in their future success.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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