Zomato To Raise Rs 8500 Cr Through QIP

Zomato's board has approved plans to raise Rs 8,500 crore through a qualified institutional placement (QIP) to strengthen its balance sheet amid increasing competition in the quick commerce sector. This news coincides with the company reporting a 68 per cent year-on-year increase in operating revenue for the July-September quarter, reaching Rs 4,799 crore, while net profit rose nearly fivefold to Rs 176 crore.

The revenue growth is largely attributed to the performance of its quick commerce unit, Blinkit, which is aggressively expanding. 

In a letter to shareholders, founder and chief executive officer Deepinder Goyal explained that the capital raise is intended to maintain competitiveness against rivals who are actively securing additional funding, despite Zomato already having over Rs 10,000 crore in its balance sheet.

During an earnings call, chief financial officer Akshant Goyal mentioned that the board's approval allows the company to proceed with the Rs 8,500 crore raise, but the final amount will depend on market conditions at the time of the QIP's launch. The company has not provided a specific timeline for this fundraising effort.