Food delivery platform Zomato's Rs 9,375 crore initial public offering - India's biggest this year - has become an instant hit among retail investors so much so that the 10 per cent retail quota for Zomato's IPO got fully subscribed in the first 75 minutes of the bidding process on Wednesday.
Data suggests that the quota was subscribed 2.16 times as of 2:30 pm. The company has so far received a total bid for 28,03,88,745 shares as against the allocated 12,95,58,333 shares.
Overall, the Rs 9,375 crore IPO was subscribed 18 per cent within 60 minutes of the bidding process on Day 1.
The IPO will be open for subscription till Friday, July 16. At Rs 72-76 per share price band, the company aims to raise Rs 9,375 crore through the offer.
The Zomato IPO comprises a fresh issue of equity shares worth Rs 9,000 crore and an offer-for-sale (OFS) worth Rs 375 crore by existing investor Info Edge (India), which is the parent company of Naukri.com, according to the information provided in the draft red herring prospectus.
The Zomato IPO will have 75 per cent reservation for qualified institutional buyers (QIBs) and 15 per cent for non-institutional investors (NIIs). The restaurant aggregator has said it will utilise the net proceeds from the fresh issue for funding organic and inorganic growth initiatives (Rs 6,750 crore) and general corporate purposes.
The company backed by Jack Ma's Ant Group Co will be among the first from a long list of Indian unicorn startups to launch an IPO. It will also be the first among Indian online food aggregators.
The IPO, which will give Zomato a valuation of Rs 64,365 crore, is being touted as the second-biggest since SBI Cards and Payment Services' Rs 10,341 crore issue in March 2020. It will surpass Indian Railway Finance Corp offering in January.
Ahead of its IPO, the food delivery platform had raised a little over Rs 4,196 crore from anchor investors, including BlackRock, Tiger Global Investments Fund, Fidelity, New World Fund Inc, JP Morgan, Morgan Stanley Asia (Singapore) Pte-ODI, Goldman Sachs (Singapore) Pte -ODI, T Rowe, Canada Pension Plan Investment Board, Government of Singapore, Monetary Authority of Singapore and Abu Dhabi Investment Authority. The company has decided to allocate 552,173,505 equity shares to anchor investors at Rs 76 apiece, aggregating the transaction size to Rs 4,196.51 crore, according to a circular uploaded on the BSE website.
also read
The domestic investors who participated in the anchor bidding include Kotak Mutual Fund (MF), Aditya Birla Sun Life MF, Axis MF, SBI MF, UTI MF, HDFC MF, ICICI Prudential MF, IDFC MF, Sundaram MF, Edelweiss MF, ICICI Prudential Life Insurance Company and HDFC Life Insurance Company.
Post-IPO, the valuation of Zomato will be more than the combined market capitalisation of five listed fast food and restaurant companies.
Jubilant FoodWorks Ltd, which is the master franchise for Domino's Pizza in India, had a market capitalisaiton of Rs 40,770.52 crore on Tuesday, according to BSE data.
Burger King India Ltd had Rs 6,659.88 crore m-cap, fast food restaurant holding company Westlife Development Ltd (Rs 8,380.89 crore), Barbeque-Nation Hospitality (Rs 3,375.48 crore) and Speciality Restaurants had Rs 336.69 crore m-cap.
The online food delivery segment has seen significant growth in the last few years with Zomato and Swiggy competing head-on to grab market share.
(With PTI inputs)
