Zomato valued at $3.6 bn in pre-IPO funding round

Food delivery unicorn Zomato has raised $195 million from a clutch of global investors ahead of its planned 2021 initial public offering (IPO).

The investment values the Gurugram-based company at $3.6 billion post money, Zomato’s early investor Info Edge said in a stock exchange filing.

New York-based private equity firm Luxor Capital Group led the round with $60 million while returning investor Kora Management contributed $50 million.

Seoul-based Mirae Asset put in $40 million, London headquartered Steadview Capital and New York-based private equity fund Bow Wave Capital invested $20 million each and Edinburgh-based investment firm Baillie Gifford invested $5 million.

At the closing of this round, Info Edge’s shareholding in Zomato will come down to 20.8%, on a fully converted and diluted basis.

Zomato had disclosed details about a portion of this growth round infusion in a regulatory filing last week. 

The fresh infusion is part of a targeted $600 million growth funding round, dubbed a Series J round, that Zomato intends to close before it hits the public market in 2021.

In September, co-founder and CEO Deepinder Goyal told Zomato employees that the company expected to launch an IPO by the middle of next year. The company had $250 million in the bank from the ongoing round, he said in an email at the time, adding that it would raise a total of $600 million in the round before the IPO.

It has raised $463 million in the ongoing round so far. The most recent infusion came from Kora when it invested $52 million last month. Previously, it received $50 million in the first tranche of the round in January from Ant Financial. Subsequently, the company raised $62 million and $104 million from Singapore state investor Temasek Holdings and Tiger Global Management in the second and third tranches, respectively.

Zomato doubled its year-on-year revenue to $394 million for the financial year 2019-20 from $192 million, even as its losses widened to $293 million from $277 million a year ago. It reported a revenue of $41 million with an EBITDA loss of $12 million during the Covid-19 hit June quarter of FY21.

Last month, Goyal said that food delivery volumes on the platform had returned to pre-Covid peaks in India. He added that a number of cities were witnessing over 120% of pre-Covid peaks, and expected the food delivery sector to continue to grow at about 15-25% month-on-month for the foreseeable future. Zomato had delivered a total of 9.2 crore orders since March 23, 2020, he tweeted.