Zomato raises Rs 4,196 Cr from anchor investors ahead of its IPO

Online food delivery platform Zomato said it has raised Rs 4,196 crore from marquee anchor investors as a part of its anchor book allocation, a day before the opening of its public offering. 

In a filing with the National Stock Exchange on Tuesday, the company said it has finalised the allocation of 55,21,73,505 equity shares to a total of 186 anchor investors including the likes of Tiger Global, Goldman Sachs, Blackrock Global Investments, JP Morgan Funds, T Rowe Price, Steadview Capital and Baillie Gifford, among others. 

Other global investors such as the government of Singapore, Canada Pension Plan Investment Board, Fidelity, Pinebridge Global Funds, Aberdeen Global Indian Equity, Neuberger Berman and Abu Dhabi Investment Authority also participated. 

Amongst domestic investors, SBI Mutual Fund, Axis Mutual Fund, SBI Life Insurance, Aditya Birla Sun Life, ICICI Prudential, and Nippon Life India, among others, invested in the company via the anchor book. A total of 184,104,960 shares were allocated to 19 domestic mutual funds through a total of 74 schemes.

These anchor investors have subscribed to  Zomato's equity shares at a price of Rs 76 per equity share.

Zomato’s offer will open for subscription on July 14 and the price band for the issue has been fixed at Rs 72-76 per equity share. The total issue size is Rs 9,375 crore. 

In its red herring prospectus, the company had said it will use Rs 6,750 crore from the fresh proceeds for funding organic and inorganic growth and the rest for general corporate purposes. 

According to the RHP, Zomato’s food delivery business suffered significantly due to the COVID-19 pandemic and the total number of orders placed on its platform in India decreased by 40.7% from 403.1 million in FY20 to 238.9 million in FY21. 

As a result, collections suffered and revenue from operations dropped by 24% to Rs 1,994 crore in FY21 from Rs 2,605 crore in FY20. During the fiscal ended in March 2021, the Gurugram-based company made 86% of its operating revenue from food delivery services which stood at Rs 1,715 crore.