India’s Zomato valued at $5.4 billion in new $250 million investment – ClearTips

Zomato has raised $ 250 million two months after closing the 660 million Series J financing round, as the Indian food distribution startup builds a battle-chest ahead of its IPO later this year.

Cora (which contributed $ 115 million), Fidelity ($ 55 million), Tiger Global ($ 50 million), Bo Wave ($ 20 million) and Dragoneer ($ 10 million) are 12-year-old Gurgaon-headquartered startups In the new capital cast, the information was publicly disclosed in Zomato disclosed in a filing (PDF) to a local stock exchange investor. The new investment gives Zomato a post-money valuation of $ 3.9 billion to $ 5.4 billion in December last year, said Info Edge, which has an 18.4% stake in the Indian startup.

The new investment reinforces investors with strong confidence in Zomato, who have been struggling to raise a lot of money for the past year. Zomato, which acquired Uber’s Indian food distribution business early last year, competes with Prosus Ventures-backed Swiggy (valued at approximately $ 3.6 billion) in India. Together they work with over 440,000 distribution partners, a larger workforce than those employed by the Indian Postal Department.

A third player, Amazon, entered the food delivery market in India last year, though its operations are still limited to parts of Bangalore.

At stake is India’s food distribution market, which Bernstein analysts expect to be worth $ 12 billion by 2022, he wrote to clients in a report. With nearly 50% market share, Zomato is the current leader of three, Bernstein analysts wrote.

“We find that the food-tech industry in India is positioned for sustained growth with improvement in unit economy. Take-rates are highest in India at 20-25% and consumer traction is increasing. The market is largely monopolized between Zomato and Swiggy with 80% + share, ”Bank of America analysts wrote in a recent report reviewed by ClearTips.

Zomato and Swiggy have improved their finances in recent years, which is particularly impressive as making money with food delivery in India is much more challenging. Unlike Western markets like the US, where each delivery item in India is valued at around $ 33, a similar item bears a price tag of $ 3 to $ 4 according to research firms.

Both startups eliminated hundreds of jobs last year as the coronovirus epidemic hit their businesses. Jomato co-founder and chief executive Deepinder Goyal said in December that the food delivery market was “rapidly coming out of the COVID-19 shadow.”

“December 2020 is expected to be the highest GMV month in our history. We are now seeing ~ 25% more GMV than our previous peaks in February 2020. I am very excited about what will happen next and what impact we will create for our customers, distribution partners and restaurant partners, ”he said.

In an email to employees in September last year, Goyal said Zomato had been working on its IPO for some time “in the first half” of 2021 and was raising money to build a battle-chest for “future M&A” Was, and was fighting any misunderstanding or price. War from our competition in different areas of our business. “

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