Zomato has reported a significant 68.5% quarter-on-quarter growth in operating revenue, reaching Rs 4,799 crore in Q2 FY25, up from Rs 2,848 crore in the same quarter last year. This impressive performance was fueled by strong growth in its core food delivery business, B2B vertical, and its quick commerce arm. The company’s board also approved a plan to raise Rs 8,500 crore through qualified institutional placements, coinciding with rival Swiggy’s upcoming IPO.
Zomato’s core food delivery segment contributed 42% of the total revenue in Q2 FY25. Revenues surged by 30% to Rs 2,012 crore, compared to Rs 1,546 crore in Q2 FY24. The growth was largely driven by a rise in order volumes, higher average order values, and the company’s expansion into new cities. Their quick commerce vertical, Blinkit, experienced a staggering 129% revenue growth, reaching Rs 1,156 crore, up from Rs 504 crore in Q2 FY24. This growth was supported by increased order frequency and the addition of new stores. Moreover, Hyperpure, Zomato’s B2B supplies arm catering to restaurants, posted a 97% increase in revenue, totaling Rs 1,473 crore compared to Rs 747 crore in the same period last year. This segment continues to expand as more restaurants rely on Zomato for procurement services.
Despite the strong revenue growth, Zomato faced rising expenses. Delivery-related costs surged by 97.9% to Rs 1,334 crore, forming 29.2% of total expenses. Overall expenditure rose to Rs 4,783 crore, up from Rs 3,039 crore in Q2 FY24, with major costs attributed to procurement, employee benefits, marketing, and advertising. However, employee benefits dropped by 11.2% due to lower ESOP costs.
On the profitability front, Zomato reported a 4.8x increase in net profit, rising to Rs 176 crore in Q2 FY25, compared to Rs 36 crore in Q2 FY24. The EBITDA before ESOP costs improved, reaching negative Rs 186 crore, reflecting a Rs 359 crore improvement quarter-on-quarter. Zomato ended the quarter with a robust cash balance of Rs 10,800 crore. However, despite its strong financials, Zomato’s stock price dipped to Rs 256.55 as of October 22, 2024, with a market capitalization of Rs 2,26,645 crore ($27 billion).
