Zomato's IPO will be available for subscription till Friday. Zomato IPO Live Updates: Online food delivery platform Zomato, which launched its initial public offering (IPO) on Wednesday, July 14, 2021, saw its issue get subscribed 38.25 times on the final day of IPO.
At 5:00 pm, the shares which are to be allocated for the qualified institutional buyers (QIBs) got subscribed 51.79 times, while those of non institutional investors were subscribed 32.96 times and that of the retail individual investors (RIIs) was subscribed 7.45 times. Separately, shares for the employees’ segment was subscribed to around 62 per cent, the BSE data showed.
The subscription period for Zomato IPO was available from till 5 pm on July 16, 2021.
The IPO – India’s biggest this year – was available for subscription during July 14-16, 2021. The price band of Zomato IPO was fixed at Rs 72-76 per share of the face value of Rs 1 each and the company aims to raise Rs 9,375 crore through the offer.
The IPO comprises a fresh issue of equity shares worth Rs 9,000 crore and an offer for sale (OFS) worth Rs 375 crore by existing investor Info Edge (India), which is the parent company of Naukri.com, according to the information provided in the red herring prospectus.
Ahead of the IPO, Zomato raised over Rs 4,196 crore (Rs 41,96,51,86,380) from 186 anchor investors in lieu of 55,21,73,505 equity shares at Rs 76 each, data from the stock exchanges showed.
The anchor investors include the likes of Tiger Global Investment Fund, Blackrock, Fidelity, JPMorgan, Morgan Stanley, T Rowe Price, Canada Pension Plan Investment Board, Government of Singapore, SBI Mutual Fund, Axis Mutual Fund, Kotak Mutual Fund, UTI Mutual Fund, Motilal Oswal AMC, HDFC Mutual Fund, ICICI Prudential Mutual Fund, Tata Mutual Fund, Goldman Sachs India, Abu Dhabi Investment Authority, Franklin Templeton, HSBC Asset Management (India) among others.
Zomato IPO Update as of 5:00 PM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 51.79 times
Non Institutional Investors subscribed 32.96 times
Retail Individual Investors (RIIs) subscribed 7.45 times
Employee Reserved subscribed 0.62 times
Total subscribed 38.25 times
Source: BSE
Zomato IPO Update as of 4:00 PM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 51.76 times
Non Institutional Investors subscribed 32.68 times
Retail Individual Investors (RIIs) subscribed 7.34 times
Employee Reserved subscribed 0.54 times
Total subscribed 38.14 times
Source: BSE
Zomato IPO Update as of 3:00 PM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 36.32 times
Non Institutional Investors subscribed 19.58 times
Retail Individual Investors (RIIs) subscribed 7.03 times
Employee Reserved subscribed 0.53 times
Total subscribed 26.20 times
Source: BSE
Zomato IPO Update as of 2:00 PM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 23.16 times
Non Institutional Investors subscribed 11.16 times
Retail Individual Investors (RIIs) subscribed 6.47 times
Employee Reserved subscribed 0.44 times
Total subscribed 16.71 times
Source: BSE
Zomato IPO Update as of 12:45 PM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 14.71 times
Non Institutional Investors subscribed 2.45 times
Retail Individual Investors (RIIs) subscribed 5.98 times
Employee Reserved subscribed 0.41 times
Total subscribed 9.69 times
Source: BSE
Zomato IPO Update as of 11:45 AM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 11.67 times
Non Institutional Investors subscribed 1.09 times
Retail Individual Investors (RIIs) subscribed 5.69 times
Employee Reserved subscribed 0.40 times
Total subscribed 7.64 times
Source: BSE
Zomato IPO Update as of 10:15 AM on Day 3 - final day
Qualified Institutional Buyers (QIBs) subscribed 7.07 times
Non Institutional Investors subscribed 0.60 times
Retail Individual Investors (RIIs) subscribed 5.02 times
Employee Reserved subscribed 0.38 times
Total subscribed 4.89 times
Source: BSE
After being subscribed 4.79 times on the second day, the final day of subscription of Zomato IPO will resume at 10 am today.
The Qualified Institutional Buyers (QIBs) segment was subscribed 7.06 times, Non Institutional Investors segment was subscribed 0.45 times, Retail Individual Investors (RIIs) got subscribed 4.73 times and Employee Reserved segment was subscribed 0.36 times, data from the BSE showed.
Zomato IPO: At the end of Day 2, the Zomato IPO has been subscribed 4.79 times.
Details:
Qualified Institutional Buyers (QIBs) subscribed 7.06 times
Non Institutional Investors subscribed 0.45 times
Retail Individual Investors (RIIs) subscribed 4.73 times
Employee Reserved subscribed 0.36 times
Total subscribed 4.79 times
Source: BSE
Zomato IPO Update as of 2:45 PM on Day 2
Qualified Institutional Buyers (QIBs) subscribed 1.19 times
Non Institutional Investors subscribed 0.30 times
Retail Individual Investors (RIIs) subscribed 4.27 times
Employee Reserved subscribed 0.25 times
Total subscribed 1.50 times
Source: BSE
Zomato IPO Update as of 1:15 PM on Day 2
The Zomato IPO was subscribed 1.29 times as of 1:15 pm on the second day of bidding. So far the Qualified Institutional Buyers (QIBs) segment was subscribed 0.98 times while the Non Institutional Investors got 0.24 times subscription, data by the BSE showed.
The retail segment was the most subscribed having seen 3.87 times bid for Employee segment got subscribed 0.21 times. The offer will conclude at 5pm on Friday, July 16, 2021.
Zomato IPO Update as of 12:15 PM on Day 2
Qualified Institutional Buyers (QIBs) subscribed 0.98 times
Non Institutional Investors subscribed 0.18 times
Retail Individual Investors (RIIs) subscribed 3.54 times
Employee Reserved subscribed 0.21 times
Total subscribed 1.22 times
Source: BSE
Zomato IPO Update as of 11:15 AM on Day 2
Qualified Institutional Buyers (QIBs) subscribed 0.98 times
Non Institutional Investors subscribed 0.15 times
Retail Individual Investors (RIIs) subscribed 3.33 times
Employee Reserved subscribed 0.21 times
Total subscribed 1.17 times
Source: BSE
On Wednesday after the end of the first day of the IPO, Zomato tweeted: "received more love today than on our birthday 4 days ago. glad to see people care less about how far we've come and more about how far we can still go"
Zomato IPO Update as of 10:15 AM on Day 2
Qualified Institutional Buyers (QIBs) subscribed 0.98 times
Non Institutional Investors subscribed 0.14 times
Retail Individual Investors (RIIs) subscribed 2.94 times
Employee Reserved subscribed 0.20 times
Total subscribed 1.10 times
Source: BSE
After being fully subscribed on the first day itself, the subscription of Zomato IPO will resume at 10 am today. The offer was subscribed 1.05 times on Wednesday. The Qualified Institutional Buyers (QIBs) was subscribed 0.98 times, Non Institutional Investors was subscribed 0.13 times, Retail Individual Investors (RIIs) got subscribed 2.69 times and Employee Reserved segment was subscribed 0.18 times, data from the stock exchanges showed.
Zomato IPO: At the end of Day 1, the Zomato IPO has been oversubscribed. The total issue has been subscribed 1.05 times.
Details:
Qualified Institutional Buyers (QIBs) subscribed 0.98 times
Non Institutional Investors subscribed 0.13 times
Retail Individual Investors (RIIs) subscribed 2.69 times
Employee Reserved subscribed 0.18 times
Total subscribed 1.05 times
Source: BSE
Zomato IPO Update as of 2:30 PM on Day 1
Qualified Institutional Buyers (QIBs) subscribed 0.10 times
Non Institutional Investors subscribed 0.08 times
Retail Individual Investors (RIIs) subscribed 2.16 times
Employee Reserved subscribed 0.07 times
Total subscribed 0.47 times
Source: BSE
Zomato IPO Update as of 1:00 PM on Day 1
Qualified Institutional Buyers (QIBs) subscribed 0.00 times
Non Institutional Investors subscribed 0.06 times
Retail Individual Investors (RIIs) subscribed 1.78 times
Employee Reserved subscribed 0.05 times
Total subscribed 0.34 times
Source: BSE
Zomato IPO Update as of 11:30 AM on Day 1
Qualified Institutional Buyers (QIBs) subscribed 0.00 times
Non Institutional Investors subscribed 0.02 times
Retail Individual Investors (RIIs) subscribed 1.09 times
Employee Reserved subscribed 0.03 times
Total subscribed 0.20 times
Source: BSE
Zomato IPO Update as of 10:30 AM on Day 1
Qualified Institutional Buyers (QIBs) subscribed 0.00 times
Non Institutional Investors subscribed 0.01 times
Retail Individual Investors (RIIs) subscribed 0.49 times
Employee Reserved subscribed 0.01 times
Total subscribed 0.09 times
Source: BSE
Zomato is the first unicorn tech company to be listed on exchanges with a market cap of ?59,623 crs (at upper band) taking it into top 100 listed entities in India. The company is one of the leading players in the food tech industry in India with a market share of ~45%. Zomato offers multiple services through its food platform in the form of search and discovery, food delivery, customer generated contents, Hyperpure and loyalty program such as Zomato Pro. With the changing dynamics, the need for outside food has seen an increase which gets fulfilled by either going out to the restaurant or ordering food from the restaurants. The millennial population have a greater tendency to eat and explore different cuisines across restaurants. Zomato is the one stop app which provides these customers with details such as photos of the menu, photos of the restaurant premises, address and GPS coordinates, phone number, website, social media presence, cuisine, opening timings, average cost for a meal, free parking availability, indoor or outdoor seating availability, free Wi-Fi availability, whether the restaurant offers live entertainment, has a smoking room, whether table booking is recommended, among others.
Zomato is a growth oriented company focused on increasing its presence further into every part of the country. FY21 revenues fell by 24% to ?1,993 crores, the number of orders declined by 41% to 239 mn, but order value increased by 43% YoY to almost ?400. Increase in frequency and number of food delivery by customers due to lockdowns along with lower customer discounts and fees to delivery partners led to contraction in losses in FY21 to 490 crs (excluding exceptional item) from ?2,251 crs in FY20. Zomato’s unit economic cost has seen an improvement in last four quarters which increased to ?20.5 in FY21 from loss of ?30.5 in FY20.
Zomato is being listed at a revenue multiple of 27x its FY21 revenues whereas global peers trade in the range of 3-19x price to sales. However, the opportunity and scope of further growth is significant for Zomato.
Source: IPO Note
We see a lot of excitement around the Zomato IPO given it’s the first large consumer tech company getting listed. Key players in the food tech industry like Zomato and Swiggy and have been able to create multiple competitive advantages like last?mile delivery infrastructure, customer data, strong brand and convenience/choice driving network effect. While the metros and Tier 1 opportunity has been well captured, there is enough potential in the Tier 2,3,4 cities. We expect better trends in customer adoption and ordering frequency given efforts in changing health perceptions on food ordering, while demographics remain favorable. The COVID pandemic has impacted revenues but improved unit economics which could be difficult to sustain going forward. While clarity is still awaited on use of IPO proceeds on M&A, it could be a combination of foray into grocery, dark kitchens, nutraceuticals etc. While we see strong investor interest despite punchy valuations at 25x FY21 EV/sales given the uniqueness of the business model, the path to profitability is still not clear. While growth potential and a cash rich balance sheet offer immense growth potential, its difficult to value the stock on conventional parameters. Hence, we would advise to subscribe for listing gains only and would wait to see multiple legs of the story unfold before coming up with a more nuanced fundamental view.
Source: IPO Note by YES Securities Institutional Equities
Zomato with first mover advantage is placed in a sweet spot as the online food delivery market is at the cusp of evolution. It enjoys couple of moats and with economics of scale started playing out, the losses have reduced substantially. However, predicting the growth trajectory at this juncture is little tricky for next few years. The valuation also appears expensive at 25x FY21 EV/Sales compared to average of 9.6x for global peers and 11.6x for Indian QSRs. Though, valuing such early stage businesses on plain vanilla financial matrix might not give the right picture and may look distorted. Investors with high risk appetite can Subscribe for Listing Gains given fancy for unique and first of its kind listing in the food delivery business.
Source: IPO Note on Zomato Ltd by Motilal Oswal Financial Services
ZL's Platform Offerings
Business of the Company is built around the core idea that over time, people in India are going out to eat at restaurants more than they cook at home. To capture value out of this shift in customer behaviour, it has two core business-to-customer (B2C) offerings – (i) Food delivery and (ii) Dining-out, in addition to its business-to-business (B2B) offering (iii) Hyperpure. Another important part of its business is (iv) Zomato Pro, its customer loyalty program which encompasses both food delivery and dining-out. Each of B2C as well as B2B offerings helps increase the value of its platform for its customers, enabling it to further attract new customers and to deepen engagement with existing customers. Each of its offerings also helps improve Assortment, Affordability, Accessibility and Quality (“AAAQ”) of restaurant food for its customers thereby helping grow the restaurant industry.
Food Delivery
The Company has consistently gained market share over the last four years to become the category leader in the food delivery space in India in terms of GOV from October 1, 2020 to March 31, 2021. It generates a majority of its revenue from food delivery and the related commissions charged to its restaurant partners for using its platform. Restaurant partners also spend for advertisements on its platform. There are three key stakeholders in its food delivery business – (i) Customers, (ii) Delivery Partners, and (iii) Restaurant Partners.
Dining-Out
Customers use dining-out offerings to search and discover restaurants, read and write customer generated reviews and view and upload photos, book a table and make payments while dining-out at restaurants. It is a preferred destination for dining-out search and restaurant discovery in India. Currently it monetize its dining-out offering through advertisement sales through which restaurant partners pay for enhanced visibility on its platform. In Fiscal 2021, 2,512 restaurant partners paid for its advertising sales product in India compared to 8,064 restaurant partners in Fiscal 2020. It currently do not monetize table reservations or dining-out payments.
B2B Supplies (Hyperpure)
Hyperpure is farm-to-fork supplies offering for restaurants in India. It source fresh, hygienic, quality ingredients and supplies directly from farmers, mills, producers and processors to supply to its restaurant partners, helping them make their supply chains more effective and predictable, while improving the overall quality of the food being served. In the month of March 2021, it supplied to 9,225 restaurant partners across six cities in India. Hyperpure helps it to increase its engagement with restaurant partners on its platform, and in turn retain and grow its loyalty with them.
Source: IPO Note – Zomato Limited by Institutional Research Desk at HDFC Securities
Zomato is the largest online food delivery players in India, with dominant market share in delivery and restaurant classified. Further, the company started new adjacent revenue stream like HyperPure in 2019, which is growing at a rapid pace. Over FY2018-FY2021, the company’s Orders grew by 7.8x from 30.6 million in FY2018 to 238.9 million in FY2021 and its GOV grew 7.1x from Rs. 1,334cr in FY2018 to Rs. 9,482.9cr in FY2021.
At the upper end of the IPO price band, the offer is valued at 29.9x of its FY21 market-cap to sales. Going forward, industry delivery percentage to net-revenue stands at ~5% and with the Zomato average order value of Rs. 400 (i.e. Rs. 20 per delivery) the company is well poised and it is also placed at a sweet spot as the first mover advantage in the online food delivery market.
Additionally, given the strong network effects, increasing frequency of order, huge scope for growth in tier-II and tier-III cities and large addressable market, we recommend a Subscribe (Short Term) rating to the IPO.
Source: IPO Note
Zomato will launch its IPO at 10 am today. The offer is going to be available for subscription till 5 pm on Friday, July 16, 2021.
The price band of Zomato IPO is fixed at Rs 72-76 per share of the face value of Rs 1 each. It comprises a fresh issue of equity shares worth Rs 9,000 crore and an offer for sale (OFS) worth Rs 375 crore by existing investor Info Edge (India).
On Tuesday, Zomato raised over Rs 4,196 crore (Rs 41,96,51,86,380) from 186 anchor investors in lieu of 55,21,73,505 equity shares at Rs 76 each.
Before heading into the IPO, Zomato raised over Rs 4,196 crore (Rs 41,96,51,86,380) from 186 anchor investors in lieu of 55,21,73,505 equity shares at Rs 76 each on Tuesday, data from the stock exchanges showed.
The anchor investors include the likes of Tiger Global Investment Fund, Blackrock, Fidelity, JPMorgan, Morgan Stanley, T Rowe Price, Canada Pension Plan Investment Board, Government of Singapore, SBI Mutual Fund, Axis Mutual Fund, Kotak Mutual Fund, UTI Mutual Fund, Motilal Oswal AMC, HDFC Mutual Fund, ICICI Prudential Mutual Fund, Tata Mutual Fund, Goldman Sachs India, Abu Dhabi Investment Authority, Franklin Templeton, HSBC Asset Management (India) among others.
*The IPO size of Rs 9,375 crore marks an increase from Zomato’s previously announced Rs 8,250 crore when it filed preliminary documents with market regulator Sebi.
*The Zomato IPO will have 75 per cent reserved for qualified institutional buyers (QIBs) and 15 per cent will be reserved for non-institutional investors (NIIs). The remaining 10 per cent of the issue will be available for retail investors.
*The proceeds from the fresh issue will be used towards funding organic and inorganic growth initiatives and for general corporate purposes.
*Investors who wish to subscribe to the Zomato IPO can bid in a lot of 195 equity shares and multiples thereafter. At the upper price band, they will be shelling out Rs 14,820 to get a single lot of Zomato. The shares will be listed on both BSE as well as the National Stock Exchange (NSE). Click here to read more
*Food delivery platform Zomato's Rs 9,375 crore initial public offering - India's biggest this year - will open on Wednesday amid buzz of strong response from global institutional investors.
*The IPO will be open for subscription till July 16.
*At Rs 72-76 per share price band, the company aims to raise Rs 9,375 crore through the offer.
*The IPO comprises a fresh issue of equity shares worth Rs 9,000 crore and an offer for sale (OFS) worth Rs 375 crore by existing investor Info Edge (India), which is the parent company of Naukri.com, according to the information provided in the red herring prospectus.
*Post IPO, valuation of Zomato will be more than the combined market capitalisation of five listed fast food and restaurant companies.
(Inputs from PTI)
While the pandemic has severely hit the services sector, business improved for consumer internet companies after the initial lockdown last year. These benefited once home delivery of food was permitted while restaurants were not allowed to open.
According to Zomato’s filings, the gross order value on its platform fell to Rs 1,093.63 crore for April-June 2020 from Rs 2,684.91 crore in January-March 2020. It then rose to Rs 2,981 crore for October-December, higher than in the same quarter the previous year. The first nine months of FY20-21 show an improvement in unit economics of Zomato’s business, with commissions and delivery charges rising compared to 2019-20, and discounts falling greatly. In a press conference Thursday, Zomato’s leadership said compared to the first wave of Covid, its business did not witness a negative impact during the second.
Zomato’s offer size of Rs 9,375 crore marks an increase from the previously announced Rs 8,250 crore when it filed draft documents with market regulator SEBI in April. It has set a price band of Rs 72–76 per share. Bids can be made for a minimum of 195 equity shares, and in multiples of 195 thereafter. Of the total offer size, shares worth Rs 9,000 crore are fresh issue while the remaining is an offer for sale by Info Edge (India) Ltd.
While the pandemic has severely hit the services sector, business improved for consumer internet companies after the initial lockdown last year. These benefited once home delivery of food was permitted while restaurants were not allowed to open. Read our explainer here.
The Zomato IPO will have 75 per cent reserved for qualified institutional buyers (QIBs) and 15 per cent will be reserved for non-institutional investors (NIIs). The remaining 10 per cent of the issue will be available for retail investors.
The online food delivery giant aims to raise Rs 9,375 crore through the offer. The Zomato IPO comprises a fresh issue of equity shares worth Rs 9,000 crore and an offer for sale (OFS) worth Rs 375 crore by Info Edge (India).
Zomato IPO:
Date: July 14-16, 2021
Price band: Rs 72-76 per share
Face value: Re 1
Lot size: 195 equity shares and in multiples thereof