Zomato is the first online food aggregator to launch an IPO. Based on its IPO, the valuation of Zomato comes to INR 64,365 crore. After the opening of the popular Zomato IPO, some investors face server or network issues. This is because the demand is very high in a very short period. One can bid for the Zomato IPO through Zerodha, Upstox, Motilal Oswal, and other broker apps.
Let’s discover 5 Facts and Analyst’s takes on the popular Zomato IPO.
- Zomato’s public offering includes the issuance of equity shares worth INR 9,000 crore and an offer for sale of Rs 375 crore by Info Edge India Ltd, its largest shareholder. About 65 lakh equity shares have been reserved for the employees of the company.
- Zomato has fixed the IPO price band at INR 72-76 per share and investors can subscribe in a minimum of 195 equity shares and multiples thereafter.
- Up to 75 percent of the total public offering is reserved for qualified institutional buyers, up to 10 percent for retail investors, and the remaining 15 percent for non-institutional investors. In the upper band, the company will be valued at around INR 60,000 crore.
- Zomato plans to use the funds raised from the IPO to finance organic and inorganic growth initiatives and other general corporate purposes.
- SBI Cards and Payment Services (INR 10,341 crore) IPO came in March 2020, after which it is considered to be the second-highest IPO.
5 important analyst’s takes on the popular Zomato IPO.
- Analysts tracking the Zomato IPO are optimistic about the firm’s listing gains, but are unsure about the long-term risks that economic revival entails.
- Several brokerages have also raised concerns about the high valuations set by Zomato as the company has seen a fall in revenue in FY21 due to the Covid-19 pandemic.
- According to Reliance Securities, the company’s IPO is valued at more than 28 times the FY21 enterprise value (EV), which has boosted the valuation.
- Zomato offers many advantages – from being a new-age digital company to a strong dominance in online food delivery – with some risks attached.
- As the company plans to expand its business rapidly, this may lead to higher costs and losses. This is another reason why analysts are uncertain about the future profitability of the company for the next few years.
Meanwhile, #ZomatoIPOLoss was trending on twitter while we were working on this points.