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Zomato to take its big step through IPO

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Zomato Ltd. is going public as it announced its first IPO, scheduled to be held on July 14, 2021. The company had filed a DHRP in SEBI earlier but the dates of the IPO and the fund value were not announced till now. While its operations began in 2008 as a food review app, over the years it expanded its services. The platform became a link between restaurants and customers. It provides several services other than just home delivery of food. But the majority of the fund comes from online food delivery. The IPO would provide funds for the further development of this startup. Zomato then becomes the first of its kind to list its shares on National Stock Exchange and Bombay Stock Exchange. The startup looks forward to raising upto Rs. 9375 crores by offering fresh stocks and through an offer of Rs.72-76 per share according to The Economic Times.

Set between July 14 and 16, the Initial Public offering is set to amass funds for its future development. The shares which could be bid by institutional and non-institutional bidders are placed at 75% and 15% respectively, while the employees will have access to 6.5 million shares, as noted by The Economic Times. 10% of the stocks are reserved for retail investors. The chief financial officer claims that they will have over $2 billion in cash after the IPO.

With services in over 552 cities in India and also in other countries, the startup is experimenting with the idea of online grocery sale which is confirmed by its investment in Grofers. With Amazon entering the food market, Zomato needs to watch out. Even though it was able to maintain a supreme position in its field a stronger competitor may reduce its brand value. But the founders deny it by saying that it has already been a year(of Amazon entering their marketplace) but no change in their market value took place.

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