Zomato IPO Launch On July 19 At Rs 70 Price Band? Rs 8250 Cr Expected To Be Raised
Zomato will finally be opening up the subscription of its IPO on July 19. The price band will be Rs 70-72 per share.
Read on to find out all the details!
Zomato To Finally Launch IPO; Subscription Open from July 19
Reports have confirmed that Zomato’s IPO will most probably be open to subscription on July 19 and will Continue till July 22. The subscription for the IPO will open from July 19 to 22. There are reports that state that the size of the IPO would now be increased to Rs. 9375 crores. Of this, Rs 9,000 crore will be fresh equity and shares worth Rs 375 crore from InfoEdge, which is the company’s largest shareholder.
The Securities and Exchange Board of India, SEBU has also given its permission to Zomato to raise Rs. 8250 crore through an initial share sale.
As per the draft red herring prospectus, this IPO will include a fresh issue of equity shares worth Rs 7,500 crore and an offer-for-sale to the tune of Rs 750 crore by Info Edge (India) Ltd.
As we reported earlier, Zomato, India’s top online food delivery platform is getting ready for a massive IPO (initial public offering) with the Securities Exchange Board of India (SEBI).
Zomato Plans To Raise Rs. 8250 Crores As Business Takes Off
The food delivery aggregator plans to raise Rs 8,250 crore this year as the cases continue to grow and Zomato’s business is booming. The draft red herring prospectus (DRHP) with the market regulator confirms Zomato is aiming to raise Rs 8,250 crore in capital by offering the company’s equity shares for sale.
Zomato had filed preliminary IPO papers with SEBI in April and received its observation on July 2, as confirmed by an update from the regulator.
As suggested by the draft papers, the proceeds from the fresh funding will be used for the funding of organic and inorganic growth initiatives; and general corporate purposes.
As we all know, the observation of SEBI is crucial for a company who is launching public issues like IPO, follow on public offer (FPO) and rights issue.
Sebi’s observation is very necessary for any company to launch public issues like IPO, follow on public offer (FPO) and rights issue.
Going by the draft papers, proceeds from the fresh issue would be used towards funding organic and inorganic growth initiatives; and general corporate purposes.
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.
Zomato’s 2019-20 revenue had jumped over two-fold to $394 million (around Rs 2,960 crore) from the previous fiscal year, while its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) loss was around Rs 2,200 crore.
In February, Zomato had raised $250 million (over Rs 1,800 crore) in funding from Tiger Global, Kora, and others, valuing the online food ordering platform at $5.4 billion.
Kotak Mahindra Capital company, Morgan Stanley India Company Pvt Ltd, and Credit Suisse Securities (India) Pvt Ltd are the global coordinators and book running lead managers to the issue.
BofA Securities India Ltd and Citigroup Global Markets India Pvt Ltd have been appointed as merchant bankers to the public issue. The shares the company will be listed on BSE and NSE.
Last year, Zomato founder and CEO Deepinder Goyal had told employees that the company was planning to go for an IPO in the first half of 2021.