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Zomato files draft offer document for Rs 8,250-crore IPO

Indian restaurant aggregator and food delivery platform has filed the draft red herring prospectus (DRHP) for an initial public offering of Rs 8,250 crores.

Zomato Logo (Source: Official Twitter Handle)

New Delhi: Indian restaurant aggregator and food delivery platform has filed the draft red herring prospectus (DRHP) for an initial public offering of Rs 8,250 crore with Securities and Exchange Board of India (SEBI).

The initial public offering (IPO) will comprise of fresh issue of equity shares worth Rs 7,500 crore and will offer for the sale to the tune of Rs 750 crore by Info Edge (India) Ltd, as per the draft red herring prospectus filed on Wednesday.

The Info Edge on Tuesday had said, it will sell its stake worth Rs 750 crore in the initial public offering (IPO) of its investee company Zomato.

”The Board of Directors of the Company today considered and have given their approval to the company to participate in the said Offer for Sale of up to such number of shares of Zomato Ltd as would aggregate upto Rs 7,500 million”, Info Edge said.

The move comes after Zomato announced the appointment of five independent directors on its eight-member board, including four women on April 23. Zomato has recently amended its Memorandum of Association and renaming itself Zomato Limited and has converted itself from a private company to a public limited company.

As per the company, the proceeds from the fresh issue would be used towards funding organic and inorganic growth initiatives; and general corporate purposes. The consumer sentiment for online food ordering and food delivery segment has seen significant growth in the last few years, especially between Swiggy and Zomato, who have been competing head-on for market share.

The food delivery service provider, Zomato’s FY20 revenue had jumped over two-fold to $ 394 million (around Rs 2,960 crore) from the previous fiscal, while its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) loss was around Rs 2,200 crore.

In February, Zomato had raised USD 250 million (over Rs 1,800 crore) in funding from Tiger Global, Kora and others, valuing the online food ordering platform at USD 5.4 billion.

Kotak Mahindra Capital Company Limited, Morgan Stanley India Company Private Limited and Credit Suisse Securities (India) Private Limited are the global coordinator and book running lead manager to the issue.

BofA Securities India Limited and Citigroup Global Markets India Private Limited have been appointed as merchant bankers to the public issue.

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The equity shares of the company will be listed on BSE and NSE.

Last year, Zomato founder and CEO Deepinder Goyal had told employees that the company plans to go for an IPO in the first half of 2021.

(With inputs from PTI)

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