The Rs 9,375 crore issue had received bids for Rs 2.13 lakh crore worth shares which were the third-highest in Indian capital history. The listing was advanced to Friday. Given the strong demand for the issue, analysts were largely expecting the IPO to list at a 25-30 per cent premium.
A leading online food aggregator, Zomato offers a platform for connecting consumers with restaurants. On average, 3.21 crore monthly active users (MAUs) visited the Zomato platform in FY21. The company has a presence in 525 cities and has 389,932 active restaurant listings. It also had 1,69,802 active delivery partners as of March 31. Other than India, the company has footprints across 23 countries.
Despite Zomato gaining significant scale in terms of revenue — clocking 62 per cent annual growth over FY18-FY21 — the company continues to incur losses. While a few brokerages were cautious on the IPO, investors lapped up the issue with both hands. Overall, the issue was subscribed 38 times. The IPO quota reserved for qualified institutional buyers (QIBs) was subscribed 54.71 times while the those reserved for non-institutional investors (NIIs) 34.80 times. The retail quota was subscribed 7.87 times.
“Zomato’s IPO will usher listings of a significant number of digital technology companies in the coming quarter. It will naturally give a solid boost to entrepreneurship, particularly the Startup India movement, enabling wealth creation and deepening our capital markets,” said S Ramesh, Managing Director and CEO at Kotak Mahindra Capital.
Digital companies such as Paytm, Policybazaar and Mobikwik are some of the names that have already filed papers for IPOs following in Zomato’s footsteps.
