Zomato, the food delivery giant, has delivered 3 times returns in 3 years to its IPO investors. The IPO price band was Rs. 72 to 76 per share when it closed on July 16th, 2021. While now, the stocks of Zomato closed around Rs. 230 on Monday, up 200% from its initial public offering.
Zomato’s Market Cap Milestone
Zomato has also crossed the market cap of Rs. 2 lakh crore, making it the only listed New Age company with a market value of more than Rs. 1 lakh crore and also the only listed startup to give multibagger returns to its investors.
Other IPO Performances
Shares of PB Fintech are trading at around Rs. 1,400 per script, and their IPO price band was Rs. 940 to 980 per share. It launched its IPO in November 2021. ATM also launched its IPO at the same time at a price band of Rs. 280 to Rs. 2,150 per share, and it is now trading at Rs. 450 to 460.
Performance of Recent IPOs
Delivery’s IPO, which came in May 2022 at a price band of Rs. 462 to 487 per share, is now trading at around Rs. 380 levels. Even NAA, which doubled investors’ money on listing day, has seen a decline in its valuation. At the time of its IPO, its market value stood at Rs. 52,500 crore, and it’s now at Rs. 51,500 crore.
Impact on Founder and Stakeholder Equity
Zomato has also made its founder, Deepinder Goyal, a billionaire. It should be noted that Goyal has now become only the second entrepreneur from the listed New Age firms in India to join this coveted group, the first being Falguni Nayar, founder and CEO of FSN E-Commerce Ventures, which owns the beauty and fashion e-commerce platform NAA.
Criticism and Financial Implications
Zomato and Swiggy were charging until now, and this move is expected to bolster their financial performance. However, the rise in fees has also drawn criticism lately. Deepak Shanoy, CEO of Bangalore-based company Capital Mind, recently took to X stating that he has massively reduced ordering from Swiggy and Zomato and also mentioned that they also take 30% from the restaurants.