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Separator

Zomato's Leadership Confident of Hitting the Target of $ 1 Billion in its IPO

Separator

The foodtech firm Zomato, which is set to be the first Indian tech startup to go public this year, is expected to raise between $750 million and $1 billion through its upcoming initial public offering (IPO)., according to people familiar with the matter.

The best thing about the Zomato IPO is that none of the current investors are likely to exit or sell a portion of their stake through it, according to the sources listed above. As a result of stock options awarded to them in 2014 and 2018 under the company's employee stock ownership plan (ESOP) policy, the executives have a cash pile worth $786 million (or more than $100 million).

According to the business daily, Zomato’s co-founder Deepinder Goyal told company employees in a town hall earlier this week that the company's IPO would most likely be a 100 percent primary problem, with investors expecting a long-term gain from the stock. According to Goyal, this means the company would have to raise more money rather than the shareholders selling their shares to public market investors.

The development is proclaimed to hold significance as it will provide the foodtech with a significant war chest since it seeks to maintain growth in the face of a well-capitalized rival like Swiggy, which is also raising about $800 million in new funds.

Zomato recently completed a $250 million primary funding round, with established investors such as China's Ant Financial selling another $250 million in shares. The Gurugram-based firm was priced at $5.4 billion in this deal, up from $3.9 billion in December when it completed a long-awaited $660 million funding round.

Expectations for the Zomato IPO are strong, particularly following the successful IPO of SoftBank-backed Door-Dash last year, when the US-based food-delivery startup opened trading on the New York Stock Exchange at $182, nearly 78 percent higher than its IPO price. Door-Dash was valued at $34.2 billion after raising $3.4 billion, more than double its private market valuation of $15 billion a year earlier.

According to Zomato's most recent shareholding pattern, Info Edge is the company's largest shareholder, with 18.5 percent, followed by Uber B.V. with 9.13 percent, and Alipay Singapore Holding Pte. Ltd and Antfin Singapore Holding Pte. Ltd with 8.33 percent and 8.22 percent, respectively.

Zomato recently completed a $250 million primary funding round, with established investors such as China's Ant Financial selling another $250 million in shares. The Gurugram-based firm was priced at $5.4 billion in this deal, up from $3.9 billion in December when it completed a long-awaited $660 million funding round.

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