Zomato share price drops 5% on BSE on Friday; QIP, Q2 results in focus

Zomato share price: Zomato's fundraising plans come ahead of rival Swiggy's initial public offering (IPO)

Zomato fundraise QIP news: Zomato share price today fell 5.4 per cent to Rs 256 per share on the BSE. At 12:43 PM, Zomato shares were trading 4 per cent lower at Rs 259.6 per share as against the BSE Sensex's 0.33-per cent rise.  The drop in Zomato share price came even as the company announced its fund raising plan on Thursday, October 18.

In a stock exchange filing, Zomato informed investors that "a meeting of board of directors of the Company is scheduled to be held on Tuesday, October 22, 2024, inter-alia, to consider and approve raising of funds by issuance of equity shares by way of qualified institutions placement (QIP), as may be permitted under applicable laws".

Notably, Zomato's fundraising plans come ahead of rival Swiggy's initial public offering (IPO). Swiggy is expected to launch its IPO in November 2024 and may raise up to Rs 3,750 crore via fresh issue of shares, coupled with offer for sale (OFS) for up to 185,286,265 equity shares (185.28 million equity shares) of the company. Swiggy IPO date, Swiggy IPO lot size, and price bands have not been announced yet.

According to global brokerage Macquarie, Zomato's quick commerce app 'Blinkit' has a considerable lead over Swiggy's 'Instamart' in terms of monthly transacting users (MTU), average order value (AOV), Efficiency (based on higher dark store throughput), and Take-Rate (higher ads, direct brand sourcing).

"For Swiggy, the path to catch-up in food delivery is relatively more straightforward, while that for quick commerce is more complex," it pointed out in its latest report titled 'Head-to-Head: Zomato versus Swiggy'. READ REPORT HERE

Zomato Q2 results 2024 expectations

Meanwhile, Zomato board will also consider and approve the unaudited financial results (standalone and consolidated) of the company for the quarter and half year ended September 30, 2024 on October 22, 2024.

Analysts at ICICI Securities expect Zomato's food delivery gross order value (GOV) to rise by 6 per cent quarter-on-quarter (Q-o-Q) and 23 per cent year-on-year (Y-o-Y) in Q2 FY25. It, further, expects Blinkit's GOV to grow by 20.1 per cent Q-o-Q and 114.1 per cent Y-o-Y. Additionally, Hyperpure's business (B2B) adjusted revenue is estimated to grow by 20 per cent Q-o-Q and 95.2 per cent Y-o-Y in Q2FY25.

"Overall, we estimate adjusted Zomato's Q2 revenue growth of 13.1 per cent Q-o-Q and 57.7 per cent Y-o-Y and adjusted Ebitda margin improvement to 6.8 per cent, as a proportion of adjusted revenue (vs 6.6 per cent/1.3 per cent in Q1FY25/Q2FY24). We estimate an adjusted Ebitda of Rs 350 crore in Q2FY25 (vs Rs 300 crore/Rs 40 crore in Q1FY25/Q2FY24)," the brokerage said in its results preview report.

The net profit may grow to Rs 274.3 crore, up 662 per cent Y-o-Y from Rs 36 crore, and 8.4 per cent Q-o-Q from Rs 253 crore.