Zomato reports ₹430 crores of loss in Q2 results

Zomato said the losses increased due to investments in the development of the food delivery industry, boosted fundings on branding and marketing for consumer procurement.

Advertisement

Zomato Ltd’s consolidated decline extended to ₹430 crores for the quarter ending September, against a loss of ₹229 crores in the last year. The company had recorded a loss of ₹356 crores in the past June quarter.

Zomato said the losses increased due to investments in the development of the food delivery industry, boosted fundings on branding and marketing for consumer procurement.
The decline was also essential due to enhanced investments and the increasing share of smaller or arising geographies in the business, enhanced delivery charges due to irregular weather and raised fuel prices.

Adjusted income during the quarter reached ₹1,420 crores ($189 million), a 22.6% growth quarter-over-quarter (QoQ) and 144.9% growth year-over-year (YoY). Zomato’s India food delivery Gross Order Value (GOV) in Q2FY22 increased by 19% QoQ and 158% YoY to ₹5,410 crores, propelled by a jump in the amount of transacting users, active food delivery restaurants and active delivery associates on Zomato.

Gross Order Value (GOV) is the total monetary value of all food delivery orders ordered online on Zomato India, consisting of taxes, customer delivery charges, gross of all discounts, excluding tips. Meanwhile, adjusted income for India food delivery increased by 20.7% QoQ to ₹1,250 crores ($166 million). This signifies ~88% of the total adjusted revenue for the company in the same quarter.

Adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) declined during the quarter grew to ₹310 crores ($41 million) as compared to ₹1.7 billion ($22 million) in the prior quarter (Q1 FY22) and ₹0.7 billion ($10 million) in Q2FY21 last year.

Zomato has also declared a series of negotiations to size up its business. The company said it is in the manner of selling Fitso to Curefit (Curefit Healthcare Pvt Ltd) for $50 million, with an added investment of $50 million in net cash in Curefit plus, which will give it a combined shareholding of 6.4% worth $100 million in Curefit. “This will help us potentially explore cross-selling benefits between Zomato and Curefit, as we see food and health becoming the same side of the coin in the long term,” Zomato stated in an exchange filing.

Further, Zomato has approved ultimate documents for spending $75 million in Shiprocket for an 8% stake as part of a larger $185 million round. The company has also inked a settlement with the magic pin, $50 million in Samast Technologies Ltd, for a 16% stake as part of a total round size of $60 million.

On Wednesday, before the results, Zomato shares decline by 1.20% to conclude at ₹136 apiece on NSE. Zomato, since the bumper listing lately on exchanges, has seen its shares increase by 8%. The scrip hit at ₹152.75, and the market cap passed ₹1 lakh crore during the period.