Qcommerce

Zepto Eyes $450 Million IPO by August 2025 Amid Rapid Growth: Report

• ByStartupStory     |    September 7, 2024

Zepto, the quick commerce startup renowned for its 10-minute delivery service, is reportedly in advanced talks with domestic and global merchant bankers to potentially list on Indian stock exchanges by August 2025. According to a report by Economic Times, the company aims to raise approximately $450 million through a fresh issue of shares, alongside an offer for sale (OFS) component.

The startup has engaged with prominent financial institutions including Morgan Stanley and Goldman Sachs to facilitate the IPO. The timing of the IPO is contingent on Zepto’s planned return to India. “The IPO timeline will depend on the flipping back process, but their aspiration is to list by next year…,” a source revealed.

Another source added that Zepto is closely collaborating with Morgan Stanley. “The board has told the company to ‘test the market appetite for an IPO’,” the source noted.

This development follows Zepto’s recent fundraising spree, which has seen the company raise over $1 billion in the past few months. The startup’s valuation has skyrocketed from $1.4 billion in June last year to $5 billion within a year. Last week, Zepto secured $340 million in a follow-on financing round from investors such as General Catalyst, Mars Growth Capital, and Epiq Capital. Earlier in June 2024, the company raised $665 million at a valuation of $3.6 billion.

Founded in 2021 by Aadit Palicha and Kaivalya Vohra, Zepto is recognized for its rapid delivery model, offering groceries and other items within 10 minutes. The startup is now expanding its business, planning to launch ‘Zepto Postpaid’ to enter the buy now, pay later segment.

Zepto is also aiming for significant growth in sales, targeting a gross sales run rate of $3.5 billion by December 2025. The company currently operates 400 dark stores and intends to increase this number to 700 by March 2025.

In terms of competition, Zepto faces rivals such as Zomato-owned Blinkit, Swiggy Instamart, Tata-owned BigBasket, and Flipkart Minutes.

The company has experienced substantial growth in revenue, reporting a 14.3X increase in operating revenue to INR 2,024.3 crore for the financial year 2022-23, up from INR 140.7 crore in the previous fiscal year. However, losses also surged 3.4X year-on-year to INR 1,272.4 crore.

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