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Zomato’s IPO gets oversubscribed

On 14th July, first ever start-up to unroll its initial public offering (IPO), Gurgaon based headquarters of Zomato, is set to raise a float deeming to raise Rs 9,375 crore purveying fresh stock, offering-per share on sale at Rs 72-76. Zomato had filed documents previously with the market regulator of SEBI for the approval to unroll their IPO and had then announced an amount of Rs 8,250.

Deepinder Goyal co-founder of Zomato

With the investments received in the initial public offering (IPO) Zomato aimed to raise 9375 crore out of which 9000 crore would be put in to expand the company and this Rsv 9000 crore would be yours (the investors’ money). Only one day left till the applications conclude. There’s no question that people have been wondering whether or not to invest in the IPO by Zomato, while several investors are waiting till the end for the assessment along with quality buyers for which they will have to wait until Friday evening, however Zomato has received an overwhelming response with an oversubscription of 14%. Maximum enthusiasm was seen amongst the retailers with an oversubscription of 2.67 times, the customers of Zomato are also willing to become shareholders, achieving almost the double of what they evaluated already, the company has reached their goal. Since the launch of Zomato’s IPO, many players are going to step in and open their IPO as well.

Companies like Paytm, Info edge are all for opening up the Initial public offering. Zomato so far has successfully raised Rs 4196.51 crore from 186 anchor investments just before launching its IPO. The investors’ enthusiasm can be taken at face value, Zomato being the First food delivery app to unroll its Initial public offering (IPO), is unique in its own way. To book/apply Paytm can be used for advance booking, even before the opening of an IPO. According to Paytm, money statistics show that 27% of people who have applied in Zomatos IPO are 25 years or below in age.

It is interesting to know that the applications rendered by Employees working in Zomato is only 0.04 times, which is 4% applications only, could the employees have been vary of extra information or possess sufficed shares beforehand?

Grey market premium: Rs11 to Rs16 available for Zomato IPO which means a gain of 14% to 21% listing gain after applying for Zomato IPO.

To invest or not to invest?

Amazing to see companies like Zomato choosing to list in India! While the valuation may seem expensive relative to existing tech companies on the Indian (and global) exchanges, I think there’s really no precedent for a company like Zomato – the YoY revenue growth and traction show no signs of slowing down for at least a few more years, and margins are only going to improve with greater scale. This is an incredible milestone for the Indian startup ecosystem as a whole!

Arvind Nair, founder of Neuro Pixel AI

To buy shares of a company, 2 key aspects should be kept in mind:

·         Study & understand the business model

·         seize out the evaluation of the profit being made by the company

Zomato an online restaurant aggregator and an online food delivery application has been under loss every year which is making people wonder if they should take a chance? Should we buy the shares then? Zomato is a largely growing food delivery business and has more than 100million users worldwide, it can take off in no time. Initially Zomato’s original name was foodiebay until Info Edge funded it. They further went on to twist the tomato, replacing it with Zomato. The first ever funding that Zomato received was from Info Edge itself, a company that has been investing in Zomato frequently, Info Edge which is also the parent company of Naukri.com funded Zomato with a whopping 1 Million dollar amount and has majority shares in Zomato. Your investment in Zomato would have an effect on companies like info edge and Fitso. Zomato had witnessed huge drawbacks and losses during the pandemic in the year 2020, however they saw a sudden boom in the number of orders rising at a rapid pace. In future companies like Tatva Chintan Pharma, Glenmark lifesciences and many other companies will open their IPO.

Info Edge & their share price is currently Rs 5380 and a month back it was Rs 4732 from 10th June till today their growth has been ecstatic because of Zomato.

Fitso is another start-up, involved in sports memberships and Zomato heavily invested in Fitso, Zomato leaving no stone unturned utilizing every opportunity to invest even after being in loss

Zomato IPO has been so extensively hyped and talked about, which indicates that people have been willing to be pay more as well which will bring a profitable return too.

It’s a risk worth taking, since years, start-ups have wanted to enter the field of IPO and have failed, however Zomato can take it to another level, Zomato has a sustainable networking for food delivery in India and has immense growth potential. Zomato made a massive recovery in the year 2021, making up for the losses in 2020 when the Chinese Virus had hit India. However Zomato has competition as well like Amazon who will soon be entering the food delivery arena will be a big player in future.

IPO allotment list will be published on BSE website, prospectus can be downloaded to know more about the company, future prospectus, about order size extra: https://www.bseindia.com/static/investors/application_statuschecksystem.aspx

 

TIMELINE:

  • 22nd July: Allotment of shares, if oversubscribed then a lottery system would be put into play
  • 23rd July: Refund: if your do not get the allotment then the money will be refunded
  • 26th July: Allotted shares would be received in your demat account
  • 27th July: IPO list will put on BSE website

 

Zomato IPO Details:

  • IPO opening date: 14th July 2021
  • IPO closing date: 16th July 2021
  • Issue type: Book built issue
  • Face value: Rs 1 per equity share
  • IPO price: Rs 72 to 76 per equity share
  • Market Lot: 195 shares
  • Minimum quantity of ordering: 195 shares
  • Listing on BSE https://www.bseindia.com/ and NSE https://www.nseindia.com/
  • Issue size: Equity shares of Rs 1 which is up to Rs 9,375 crore
  • Fresh issue: Shares of Rs 1 which is up to 9000000 crore
  • Offer: Share of Rs 1 which is up to Rs 375 crore

Lot size of IPO

Minimum: 1 lot, 195 shares and amount upto Rs 14,820

Maximum: 13 lots, 2535 shares and amount unpto Rs 192,660

 

Who are the stocks available to?

  • 75% of the Zomato IPO, reserved for the qualified institutional buyers
  • Non-institutional investors can bid up to 15% shares on offer
  • Retail investors have 10% of the stock
  • Employees, accessible to 6.5 million shares

Zomato ltd, launched in 2010 is a leading online food delivery application, where in minutes customers can order their food and in or around 30mins the food reaches your doorsteps.

How to apply in Zomato IPO: One can apply in Zomato IPO online with the help of either UPI or ASBA for payment, ASBA IPO applications are available on one’s net banking account and Zerodha: an application through which you can apply. Interested investors can bid for a lot and more after at a price of Rs 14,820 to get one lot of Zomato IPO.

Know the Anchor investors

Tiger global investment fund, Blackrock, Fidelity, JPMorgan, Morgan Stanley, T Rowe Price, Canada Pension plan investment board, Government of Singapore, SBI mutual funds, Kotak mutual funds, Axis mutual funds, UTI mutual funds, Motilal Oswal AMC, HDFC mutual funds, Tata mutual funds, Goldman Sachs India, Investment authority of Abu Dhabi, Franklin templeton, HSBC asset management India, raising Rs 4,196 crore.

Zomato tweets as the IPO opens: ‘mereko to aisa dhak dhak horela hai’

Even the rival company Swiggy, wished Zomato all the best on instagram

With a quirky response, Myntra aslo tweets

 

Shefali Kochhar,

Journalist, Goa Chronicle .

I am an entrepreneur who has tried her hands on various ventures like Electric Vehicle Charging Station , Online Retail Store / Trading and few more ventures. I have done my entrepreneurship from Amity University Noida.

Connect with me on Twitter

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DISCLAIMER: This article reflects author’s view point. Goa Chronicle may or may not subscribe to views of the author.

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