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Zomato Q2 results: Profit rises 5x to Rs 176 crore, revenue up 69%

The company has also received approval from its board of directors to raise up to Rs 8,500 crore via QIP of equity shares

Zomato

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Aryaman Gupta New Delhi

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The profit after tax (PAT) of food aggregator platform Zomato jumped five times to Rs 176 crore in the second quarter of financial year 2025 (Q2FY25) from Rs 36 crore during the same period a year ago.

However, PAT was down 30 per cent from Rs 253 crore in Q1FY25.

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Zomato’s revenue from operations rose 69 per cent year-on-year (Y-o-Y) to Rs 4,799 crore in Q2, up from Rs 2,848 crore a year ago. It had reported a revenue of Rs 4,206 in the previous quarter.

The company has also received approval from its board of directors to raise up to Rs 8,500 crore via a qualified institutional placement (QIP) of equity shares in a bid to strengthen its balance sheet.

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This will be the company’s first fundraise since its stock market debut. Zomato will “decide the structure, form of issuance, price, discounts, terms and conditions” in due course.

“While the business is now generating cash, we believe that we need to enhance our cash balance given the competitive landscape and the much larger scale of our business today,” said Zomato co-founder and group CEO Deepinder Goyal, in a letter to shareholders.

Since its initial public offering (IPO) in 2021, Zomato’s annualised adjusted revenue has grown four-fold from Rs 4,640 crore to Rs 20,508 crore – as of Q2FY25. During the same period, its cash balance has reduced from Rs 14,400 crore to about Rs 10,800 crore, on account of funding quick commerce losses and some equity investments and acquisitions.

Zomato’s cash balance reduced sequentially by Rs 1,726 crore in the September quarter, due to its recent acquisition of Paytm’s entertainment ticketing business for Rs 2,014 crore.

“We believe that capital by itself does not give anyone the right to win, but we want to ensure that we are on a level playing field with our competitors, who continue to raise additional capital,” Goyal added.

The company said its results for the quarter and half year ended September 30 are not comparable with other quarters and half-year results due to the acquisition of Orbgen Technologies Private Ltd (OTPL) and Wasteland Entertainment Pvt Ltd (WEPL) holding the 'movies ticketing' business and events business respectively from One 97 Communications Ltd (Paytm) in August this year.

Slight increase in adjusted revenue

Adjusted revenue for its food delivery business increased marginally to Rs 2,340 crore in Q2, up from Rs 2,256 crore a quarter ago, and Rs 1,938 crore in the year ago period.

The gross order value (GOV) for this business, meanwhile, increased from Rs 9,264 crore in Q1FY25 to Rs 9,690 crore in the September quarter. On a yearly basis, GOV increased from Rs 7,980 crore in Q1FY24.

Average monthly transacting customers for its food delivery vertical increased marginally to 20.7 million compared to 20.3 million a quarter ago.

“The business remains steady and continues to grow well,” Akshant Goyal, chief financial officer (CFO), Zomato, said in a letter to shareholders.

Blinkit rises 23 per cent sequentially

The firm’s quick commerce arm Blinkit continues to operate at near adjusted Ebitda break-even, despite new store openings. Its revenue increased over 23 per cent sequentially to Rs 1,156 crore from Rs 942 crore a quarter ago, while its GOV for the quarter increased 25 per cent to Rs 6,132 crore, compared to Rs 4,923 crore a quarter ago.

“New stores are now reaching Rs 7 lakh of GOV per day in the first full quarter post launch – at which level they reach contribution break-even,” said Blinkit CEO Albinder Dhindsa.

Blinkit’s average order value (AOV) stood at Rs 660 in Q2, up from Rs 625 in the previous quarter. Its dark store count increased Q-o-Q from 639 to 791, and average monthly transacting users reached 8.9 million in Q2 from 7.6 million in Q1FY25.

“While most of our stores today are profitable with expanding margins, we are not seeing margin expansion at aggregate level at this moment because of the investments we are making towards scaling our infrastructure,” Dhindsa added.

These investments include setting up new dark stores and large warehouses. Since these take a few months to ramp-up, they end up being margin dilutive in the short term, Dhindsa said.

Going Out revenue up 38 per cent

Revenue for Zomato’s Going Out business jumped 38 per cent to Rs 95 crore in Q2, compared to Rs 95 crore in the previous quarter and Rs 49 crore in the year-ago period. GOV for the business increased to Rs 1,849 crore in Q2, from Rs 1,268 crore a quarter ago and Rs 682 crore a year ago.

In the previous quarter, Zomato had announced the launch of District – its own live events and ticketing business after acquiring Paytm Insider, which would be spun into a separate app.

“The new app should be live in the next four weeks. At this point, we are focused on making sure we do a good job at migrating the business from Zomato and Paytm platforms to the new District app,” Zomato co-founder Goyal said.

Hyperpure

Zomato’s business-to-business (B2B) supplies vertical, Hyperpure, saw its revenue rise 17 per cent Q-o-Q to Rs 1,473 crore in Q2, compared to Rs 1,216 crore in the previous quarter. The company reported a revenue of Rs 745 crore a year ago.

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First Published: Oct 22 2024 | 4:25 PM IST

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