Zomato’s net profit falls over 30 percent in Q2

NEW DELHI New Delhi: Online food aggregator Zomato on Tuesday reported an over 30 per cent jump in net profit in the July-September period to Rs 176 crore (quarter-on-quarter) from Rs 253 crore in the previous quarter (Q1 FY 2024 – 25). Zomato’s board also approved a plan to raise Rs 8,500 crore through the qualified institutional placement (QIP) route, as competition in the quick commerce space heats up, according to a regulatory filing.

“While the business is now cash generating (compared to the loss-making business at the time of the IPO), we believe we need to increase our cash balance given the competitive landscape and the much larger scale of our business today,” Zomato founder and CEO Deepinder Goyal said. He said, “We believe that capital in itself does not entitle one to win (and quality of service is the main determinant of success), but we want to ensure that we are on an equal footing with our competitors who continue to raise additional capital.” In the second quarter, cash balance decreased by Rs 1,726 crore compared to the previous quarter due to deal consideration (Rs 2,014 crore) for the acquisition of Paytm’s entertainment ticketing business, the company said in its financial statements. Goyal said the company’s consolidated annual adjusted revenue has grown 4 times in a period of about three years – from Rs 4,640 crore at the time of its IPO in July 2021 to Rs 20,508 crore now (Q2FY25 annualised).