Indian food-delivery startup Zomato files for a $1.1 billion IPO as the country battles a catastrophic wave of COVID-19 infections
Indian food-delivery firm Zomato, backed by billionaire Jack Ma’s Ant Group and Uber, plans to raise up to 82.5 billion rupees ($1.1 billion) via an initial public offering in what would be the country’s largest stock-market listing this year.
The startup’s initial prospectus filed with the Securities and Exchange Board of India this week showed it plans to issue new shares to raise 75 billion rupees ($1.01 billion), while its top shareholder Info Edge India will offer shares worth 7.5 billion rupees ($101.2 million).
The company’s listing plans come as India combats a crippling coronavirus wave, with at least 300,000 new infections being recorded every day in the past week. Official fatalities have topped 200,000 as of Thursday, but the real number is thought to be far higher as the country’s health infrastructure appears to be collapsing under the volume of new cases.
Re-enforced lockdowns across the country have driven many Indian consumers to shift their spending online. Zomato, which serves around 70 million customers each month, saw its revenue grow 5.5 times between 2018 and 2020, after recording its highest-ever order value in history during the pandemic.
“The accelerated growth of our business stemming from the effects of the COVID-19 pandemic may not continue in the future,” the company said in its prospectus.
Zomato was founded as “Foodiebay” in 2008 by Deepinder Goyal and Pankaj Chaddah, the entrepreneurial alumni of the prestigious technical university IIT. What began as a weekend project for them grew into a well-known unicorn now present in 24 countries. At its last fundraising round in February, the company was valued at $5.4 billion.
Both the US and the UK have also seen food-delivery companies capitalizing on the stay-at-home environment during the pandemic with Deliveroo, DoorDash, and Grab all launching IPOs in the past six months.