Zomato Suffers Net Loss of Rs. 356 Crores since its IPO

Online food delivery platform Zomato has recently released its financial statement for the April-June quarter of FY 21-22. This is the first quarterly update of Zomato since its magnificent debut in the stock market last month.

Surprisingly, this company has registered a net loss of Rs. 356 crores as opposed to Rs. 99.8 crores in the same period last year. The widening loss has been primarily due to the impact of a more devastating second wave of COVID-19.

More from Q1 Financial Report

India’s largest online food aggregator has posted total revenue of Rs. 844 crores from its operations in Q1 of FY 21-22. This is almost 3 times higher than the revenue of Rs. 266 crores registered in the same phase last year.

Zomato’s total expenditure for the June quarter was Rs. 1,259 crores. This is much higher than that of the corresponding quarter of the previous year which stood at Rs. 383 crores.

According to a statement from Zomato, revenue shot up due to an increase in the core food delivery business. As a result, it enjoyed constant growth despite the second wave starting from April 2021. However, the dining out business suffered largely due to pandemic-related restrictions. This had reversed most financial gains registered in this sector in Q4 of FY21.

Zomato recorded the highest-ever number of orders, gross order value, transacting users and active delivery partners. Interestingly, Zomato’s gross order value jumped 4 times year-on-year to Rs. 4,540 crores during the April-June quarter. Sequential growth for this quarter jumped 37% as compared to the January-March quarter for FY 20-21.

Moreover, Zomato’s non-cash ESOP expenses grew significantly in Q1 of this fiscal year. This occurred due to Zomato’s substantial ESOP grants.

Impact on Zomato’s Share Price

Zomato share prices fell shortly ahead of its release of financial results for Q1 of FY 21-22. Zomato shares dropped 4.22% on 10 August 2021, Tuesday and stood at Rs. 124.95 per share on the BSE.

A Brief Overview of Zomato’s Stellar IPO

Zomato opened its initial public offering on 14 July 2021 with an issue size of Rs. 9,375 crores. It received a market capitalisation of Rs. 1.08 lakh crores on 23 July 2021 on BSE. This made Zomato one of the very few listed companies that made it to the Rs. 1 lakh crore market capitalisation club upon their debut in the stock market.

Wrapping Up

Zomato became the first-ever Indian tech start-up to go for its IPO. The stellar stock market performance has encouraged other Indian business entities to file for IPO. Leading Indian digital firms such as Ola, Paytm, Flipkart and more will be going public shortly. Other start-ups like Nykaa, PolicyBazaar, and MobiKwik have already drafted papers for their respective IPOs. It is only expected that Zomato shares will continue to garner attention in the investment arena down the road.

Want to receive more useful updates about the world of finance, investment and the stock market? Make sure to take a look at Angel One blogs.

Frequently Asked Questions

1. What is the market capitalisation of Zomato Ltd?

At the time of writing, the market capitalisation of this company is Rs. 1,06,812.12 crores.

2. What is the PB ratio of Zomato?

The PB ratio is 6.37.

3. What is the total number of Zomato shares in the market?

The total number of Zomato shares is 784.52 crores.