Zomato is inching towards its moment of truth, with the unicorn startup bracing for its highly anticipated IPO that is now likely to hit the market next month. However, nothing has so far come from horse’s mouth as the Gurgaon based company continues to remain tight-lipped over the public filing.
But highly placed sources are claiming that Zomato has started the preparations for filing a draft prospectus by April and the company is planning to raise nearly $650 Mn through public issue.
Zomato’s highly anticipated IPO has been preceded by funding spree that has helped the Gurgaon company in building a strong war chest. A war chest that will help the company in taking on its biggest rival Swiggy, which interestingly has not raised any big funding round amid Zomato’s funding juggernaut.
Only last month, Zomato raised $250 Mn from existing and new set of investors in a pre-IPO funding round. Tiger global also made its debut in India’s foodtech sector few months back by backing the Gurgaon based company. This much anticipated public issue is likely to pave way for the exit of several high profile investors including Chinese investor Ant Group.
What will be really special about this IPO is that it will be the first from India’s foodtech sector. Markets will closely match Zomato’s IPO performance since it will serve as a hint about the long term sustainability of the foodtech industry. This industry has rather proved to be a tough nut to crack as it has witnessed strong wave of consolidation over the years.
Not long time ago, the nascent sector was brimming with the presence of deep pocketed ride hailing players, with Uber’s UberEats and Ola’s Foodpanda trying hard to make a dent in the market. However, despite all their efforts and huge investment they were forced to make an unceremonious exit from the market. UberEats was acquired by Zomato while Ola chose to bid adieu to the cash guzzling food delivery business.
Zomato’s public issue will unfold one of the important chapters for India’s burgeoning startup industry as several high profile startups are queuing up to test their fortunes in India’s primary market. This includes mostly unicorn startups like PolicyBazaar, Freshworks, Nykaa, Flipkart, Grofers and Delhivery.