Zomato, a leading food delivery platform, has raised ₹8,500 crore through a Qualified Institutional Placement (QIP) by issuing equity shares to institutional investors. The decision comes as part of the company’s plan to finance its growth plans and bolster its balance sheet. Earlier, Zomato’s CEO Deepinder Goyal said that the company has raised multiple rounds of capital so far and the proposed fundraising will help them to strengthen their balance sheet to enable growth in the future.
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Zomato Raises ₹8,500 Crore Through QIP to Boost Growth and Strengthen Finances
The QIP issue was opened on November 25 and was closed on Thursday successfully. Zomato’s Fund Raising Committee approved the allotment of 33.65 crore shares to eligible qualified institutional buyers, a regulatory filing said. These shares were issued at ₹252.62 apiece for a total consideration of ₹8,500 crore. The issue price is at a discount of 5% from the floor price of ₹265.91 per share.
Shares of Zomato were trading lower on Friday despite the successful fundraising. The stock was at ₹280.15 per share at 2:26 PM, down 2.08%. However, the discounted issue price was still lower than the current market price which made QIP the zero risk investment opportunity for institutional buyers.
These funds will help Zomato in its ambitious expansion plans and bolster its balance sheet. These non-negligible funds will put the company in a higher competitive position in the fast-paced food delivery market, allowing its service to reach an expanded audience and continue investing in futuristic creative solutions.
This fundraiser is a testament to Zomato having laid the foundations for sustainable and capital-efficient long-term growth, while simultaneously reinforcing Zomato’s status as the leading player in the food delivery space. The move further suggests institutional investors’ confidence in Zomato’s vision and its ability to consistently deliver value in the dynamic food tech landscape.
FAQs
What is the purpose of Zomato’s ₹8,500 crore fundraising?
The funds will be used to support growth plans and strengthen the balance sheet.
How were the shares priced in the QIP?
The shares were issued at ₹252.62 each, a 5% discount from the floor price.
