The food delivery major issued about 336.5 million shares in a qualified institutional placement.
New Delhi: India’s leading multinational restaurant aggregator and food delivery company Zomato has raised $1 billion (Rs 8,500 crore) from institutional investors, completing its first major fundraise since its July 2021 Initial Public Offering (IPO).
According to a stock exchange filing on Friday, 29 November 2024, the food delivery major issued about 336.5 million shares of Rs 252.62 or $3 each in a qualified institutional placement.
Deepinder Goyal, Zomato’s co-founder and CEO said in October that the firm, which already had $1.3 billion in cash reserves, was raising the additional funds to maintain competitive parity.
“This fundraising effort was the first by Zomato since its IPO in July 2021, targeted at strengthening the company’s balance sheet and supporting key growth initiatives,” Deepinder Goyal had said.
Motilal Oswal was the largest investor with its family of funds picking up 20.81% of the shares issued. ICICI Prudential’s funds secured 12.78%, HDFC acquired 8.68%, Kotak Funds acquired 5.95%.
This fundraise has tactically shifted Zomato’s status to a domestic company by pushing its foreign ownership below 50% thus allow Blinkit, its quick-commerce unit, to adopt an inventory-led model, enabling direct control over products and warehousing.
A significant portion of the proceeds will be directed towards expanding the operations of Zomato’s quick commerce unit Blinkit, particularly through investments in dark stores and warehouses. Additional funds will also be utilised for advertising and marketing as Zomato looks to solidify its position in the food delivery and quick commerce space.
The capital raise has come after rival Swiggy’s $1.35 billion IPO earlier this month.
Zomato’s cash balance stood at Rs 10,800 crore as of the second quarter of the current financial year (Q2FY25) and the additional new funds will raise the amount to Rs 19,300 crore.
Comments are closed.