Uber, Tiger make Zomato realisations
Uber has fully exited its stake in India-based food services platform Zomato, which completed a domestic IPO just over 12 months ago, while Tiger Global has sold down part of its position.
The ride-hailing giant offloaded 612m shares for INR50.44 apiece on August 3, according to bulk trading data, realising proceeds of INR 30.9bn (USD 390.1m). Declines in Zomato’s stock price since the start of the year – reflecting difficulties for the technology sector globally – saw Uber post an unrealised loss of USD 707m on its investment in the first half of 2022.
Separately, Zomato said in a filing that Tiger Global had sold 184.5m shares between July 25 and August 2. The trading range of Zomato’s stock during this period was INR 41.65-INR 55.55.
Zomato acquired the Uber Eats India business in 2020, with Uber receiving a 9.9% sake in Zomato through an all-stock transaction. The reported price of around INR 13.8bn implies an entry valuation of USD 1.75bn. Around the same time, Zomato secured USD 150m in new equity funding from Ant Group, an affiliate of China’s Alibaba Group, at a valuation of USD 3bn.
By the time of Zomato’s IPO in July 2021, following dilution through subsequent funding rounds, Uber owned 9.19%. It was the third-largest external shareholder after Info Edge and Alibaba. Tiger Global held 6%, having first invested in late 2020 at a valuation of USD 3.3bn. The company was worth USD 5.4bn on closing its last private round in February 2021.
The IPO generated INR 93.7bn and Zomato achieved a market capitalisation of INR 1.1trn (USD 13.3bn) soon after it began trading. The stock peaked at INR 169 in late 2021 – up 122% on the IPO price – and then plummeted in 2022. It closed at INR 56.80 on August 4, giving Zomato a market capitalisation of INR 444.2bn (USD 5.6bn). Tiger Global’s remaining interest is worth INR 12.4bn.
Zomato allows consumers to search for restaurants, make delivery orders, book tables, pay for food while dining out at restaurants, and post reviews. Restaurant partners can use it for marketing, last-mile deliveries, and procurement. The company was in more than 1,000 towns and cities in India as of March, although it has exited numerous locations – in India and overseas – since then.
During the 12 months ended March, Zomato completed 535.2m food deliveries with a gross order value (GOV) of INR 213bn, up from 238.9m and INR 94.8bn a year earlier. On an average monthly basis, it had 14.7m transacting customers, 180m restaurant partners, and 285m delivery partners.
Revenue reached INR 55.4bn, up from INR 26.5bn, while the loss in EBITDA terms widened from INR 3.3bn to INR 9.7bn. Food delivery accounts for 86% of revenue, but the company is looking to expand its B2B restaurant supply business. Earlier this year, it bought quick commerce start-up Blinkit – formerly known as Grofers – for INR 44.5bn in stock. Tiger Global is also an investor in Blinkit.
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