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Zomato CEO Deepinder Goyal Extends Salary Waiver Till FY26

• ByStartupStory     |    November 26, 2024

Zomato’s Chief Executive Officer, Deepinder Goyal, has decided to extend his annual salary waiver of ₹3.5 crore until the end of FY26. According to the company’s Qualified Institutional Placement (QIP) documents, Goyal had initially waived his salary for a 36-month period starting FY21, which concluded at the end of FY24.

In a letter dated April 1, 2024, addressed to Zomato’s board, Goyal reaffirmed his commitment to forego his remuneration for two more years until March 31, 2026. Despite the waiver, Goyal will continue in his role as Managing Director and CEO. He remains entitled to variable pay, the specifics of which will be determined by the board at a later stage.

Goyal’s Stake Value Surges with Stock Rally

Deepinder Goyal’s stake in Zomato, which stands at 4.18%, is now valued at over ₹10,000 crore as of November 25, 2024, following a remarkable stock rally. Zomato’s shares have risen by more than 140% this year, trading at ₹277.35 per share on November 26.

Zomato’s market capitalisation has reached ₹2.45 trillion, far outpacing its competitor Swiggy, which recently debuted on the stock market with a valuation of ₹99,845 crore ($11.8 billion).

QIP Boosts Zomato’s Growth Prospects

Zomato’s shares jumped 6% on November 25 after the company announced its ₹8,500 crore ($1 billion) QIP, which was also accompanied by its inclusion in the Sensex—a first for a new-age technology company in the 30-stock index.

The company has set a floor price of ₹265.91 per share for the QIP, slightly below the current trading price. An additional 5% discount may be offered after consultation with bankers.

Planned Allocation of QIP Proceeds

The funds raised from the QIP will be allocated to key growth and marketing initiatives:

₹2,137 crore ($250 million) for setting up dark stores and warehouses.

₹2,492 crore for advertising, marketing, and branding.

₹1,769 crore for technological upgrades and infrastructure.

Remaining funds will be used for general corporate expenses.

This strategy is aimed at strengthening Zomato’s quick commerce business and addressing growing competition from players like Zepto, which has been aggressively expanding its operations.

Focus on Quick Commerce and Blinkit

Zomato plans to leverage its leadership position to bolster its quick commerce subsidiary, Blinkit. Armed with a cash reserve of ₹19,300 crore ($2.3 billion) post-QIP, the company is poised to increase its market share and tackle rising challenges in the competitive quick commerce industry.

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