Zomato Ltd. saw its shares rise 11% during Friday’s trading session following a remarkable Q1 performance and positive outlook on its food business and quick-commerce segment. As of 9:27 AM the shares were trading 10.98% higher at ₹259.79 on NSE
Key Financial Highlights:
- Net Profit: Zomato reported a net profit of ₹253 crore for the June quarter, a significant jump from ₹2 crore in the same period last year. This marks the company’s first-ever quarterly net profit.
- Revenue Growth: Revenue surged by 74% year-on-year to ₹4,206 crore, up from ₹1,416 crore in the previous year.
- EBITDA: Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) reached ₹177 crore, reversing the EBITDA loss of ₹48 crore reported last year. The EBITDA margin stood at 4.2%.
- Gross Order Value (GOV): GOV rose by 53% to ₹15,455 crore, reflecting the combined value of food delivery and quick-commerce services.
- Other Income: Other income increased to ₹236 crore from ₹181 crore last year, boosted by Zomato’s substantial cash reserves exceeding ₹12,000 crore.
Quick-Commerce Performance:
- Blinkit: Zomato’s quick-commerce business, Blinkit, reported an adjusted EBITDA loss of ₹3 crore but exceeded its store expansion target, adding 113 stores compared to a target of 100.
“As of now, we see a line of sight of getting to about 2,000 stores for our current business. Most of these stores would be in top 10 cities in India. Beyond the large cities, the size of the market is still undiscovered. If everything goes as planned (which usually doesn’t), we plan to get to 2,000 stores, latest by the end of 2026 while remaining profitable,” Blinkit chief Albinder Dhindsa said.
“Our average GOV (gross order value) throughput per store has grown from about Rs 6 lakh per day per store when we were at 383 stores exactly a year ago to about Rs 10 lakh today when we are at 639 stores. For our top 50 stores today, this number is Rs 18 lakh per day per store, and growing,” he added.
Employee Costs:
- ESOP Charges: The proportion of Employee Stock Option Plan (ESOP) charges in total employee costs has decreased from 54% in FY 2022 to 31% in FY 2024. Total employee costs have reduced to 12%, with a projected range of 6-8% of adjusted revenue by FY 2026.
New Initiatives:
- ‘District’ App: On August 1, Zomato launched ‘District’, a new app integrating dining out, movie ticketing, and lifestyle services into a single platform. This expansion aims to offer a broader array of services beyond its core food delivery and hyper-commerce operations. CEO Deepinder Goyal highlighted this move as a significant step into lifestyle services, including sports, live performances, and more.
“Today, Zomato and Blinkit are our two large consumer businesses, serving customers’ needs at home. However, we also have one of India’s largest ‘going-out’ businesses, helping our customers discover restaurants for dining out,” founder Deepinder Goyal said.
