Zomato IPO – Fun Facts and the Serious Truth

Zomato IPO – Fun Facts
IPO
08/07/2021

Zomato Ltd needs no introduction with its ubiquitous presence in the food delivery space in India. Think of food delivery, and it is obvious that you would whip out your mobile phone and click on the Zomato app. The much awaited IPO of Zomato is here and is expected to hit the market around the last week of July. What we know is that it will be a Rs.7,785 crore IPO which will include Rs.7,500 crore by way of a new issue and Rs.375 crore by way of an offer for sale to give exit to its largest shareholder, Info Edge Enterprises.

Should you invest in the Zomato IPO? Hard to decide before the final pricing comes in, but here are some fun facts and the serious truths about the Zomato IPO. Hopefully, this should help you to make a decision about investing in the Zomato IPO.

First the fun facts on Zomato

Here are some fun facts which would give you a quick idea of the business model of the company. It is like understanding the business model upside down with fun facts.

  • In the year 2020, the most ordered item on Zomato was Biryani with Zomato delivering approximately 22 orders per minute.
  • In 2020, the biggest single order was worth Rs.199,950 and smallest order was worth Rs.10 with maximum repeat orders of 360 pizzas coming from 1 customer in Jalgaon.
  • Surprisingly, Delhi, Mumbai, Bengaluru and Pune ordered 2.5 million momos in 2020, with Delhi ordering more than the other big-3 cities put together.
  • Behind these fun facts there are some hard numbers too. Zomato gets 9 crore visitors a month and covers 12,000 restaurants across 110 cities in 23 nations.

But how did this idea come about? The founders of Zomato, Deepinder Goyal and Pankaj Chaddah, were IIT-Delhi alumni working for Bain & Co. They saw colleagues spend a lot of time trying to order lunch and thus the idea of Zomato was born in 2008.

Now for the serious truth about the Zomato IPO

As investors await the finer details of the Zomato IPO, here is a quick take on some hard facts behind the Zomato story. It promises to be one of the biggest IPOs in recent times but here are the hard facts behind the apparently enticing story of Zomato.

  1. Zomato was founded in 2008 as Foodiebay but the name was changed to Zomato in 2010 and has remained so since. Its international operations include Qatar, Sri Lanka, UAE, Philippines, South Africa, UK, US and Australia.
  2. Zomato does not only delivery restaurant delicacies. It also delivers groceries and other home needs. In fact, Zomato is one of the major B2B suppliers of food and other ingredients to restaurants and other institutional customers.
  3. Zomato has raised $2.1 billion till date from venture funds and the last round valued the company at $5.4 billion. The IPO is expected to value the stock of Zomato at closer to $7.5 billion. 
  4. Finally, a quick word on why Zomato could be profitable soon. They spent as little as Rs.55 on acquiring a customer and it breaks even once the first order is delivered. In a word, the potential is humongous.

So, that in a nutshell are the fund facts and the hard truth about the issue
 

Read: Zomato IPO Note

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