12-Jun-2024
2 mins read
According to regulatory filings made with the ROC, India’s food delivery company Zomato will infuse fresh capital of Rs 300 crore into a quick commerce business named Blinkit.
In August 2022, Zomato acquired Blinkit (formerly Grofers) in an all stock deal for Rs 4,477 crore.
Zomato has infused Rs 2,000 crore in Blinkit, since it acquired the company in August 2022. With this latest investment of Rs 300 crore, the total capital infusion in Blinkit will add up to Rs 2,300 crore.
In addition to the Blinkit investment, Zomato will invest Rs 100 crore in its subsidiary, Zomato Entertainment Private Limited. This unit runs the company’s live event and ticketing business.
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Blinkit Ready to Compete with Zepto
The latest investment in Blinkit has come when the competition in the quick commerce industry is on rise. Blinkit battling with Swiggy Investmart and Zepto.
Swiggy also competes with Zomato in the food delivery and dining out segment and has filed DRHP papers with SEBI to raise Rs 10,414 crore via an IPO route. On the other hand, Zepto is in discussions to raise funding of Rs 2,500 crore via private investors.
In the quick commerce business, entries of new players such as Flipkart are possible. It shows the growth potential in the quick commerce segment. If the Blinkit business grows and becomes profitable in the coming years, then Zomato share price will indirectly benefit from price appreciation.
Zomato’s Blinkit Financial Update
In FY24, Blinkit posted a revenue of Rs 2,302 crore compared to Rs 1,064 crore reported in FY23. The revenue more than doubled in one year. The company’s adjusted EBITDA loss dropped to Rs 37 crore in Q4 FY24 compared to Rs 203 in a year ago period.
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