Sequoia Capital India has pared its stake in Zomato Ltd by selling shares in the open market, joining Tiger Global, Uber and Moore Strategic Ventures among investors who have either fully or partially sold their holdings in the online food delivery aggregator in recent weeks.
Sequioa, which first invested in Zomato in 2013, sold 171 million shares, or 2.01% stake, in the startup between September 2021 and this August, the venture capital firm said in a regulatory filing.
Sequoia offloaded 66 million shares in Zomato between 6 September and 14 October, it said, adding that the remaining 105 million shares were sold between 27 July and 25 August.
Consequently, Sequoia’s stake in Zomato has fallen to 4.4% from 6.41%, it said.
Sequoia also said that it received 45 million incremental equity shares of Zomato on 10 August following the latter’s acquisition of quick commerce firm Blinkit (formerly Grofers).
Sequoia was also an investor in Blinkit.
Shares of Zomato have corrected nearly 70% from the highs seen soon after its blockbuster listing last year.
On Friday, the stock closed 0.25% lower at ₹61.9 apiece on the BSE.
Several investors have either exited or pared their holdings in Zomato in the past few weeks, after a 12-month lock-in period for pre-initial public offering (pre-IPO) shareholders ended on 23 July.
On 26 July, Moore Strategic Ventures sold its entire Zomato stake for Rs 187.1 crore. Moore sold its shares at Rs 44 apiece. On 3 August, Uber, the second-biggest shareholder in Zomato, sold its entire 7.78% stake through block deals for Rs 3,088 crore. The US ride-hailing firm sold its shares at a price of Rs 50.44 apiece to Fidelity and ICICI Prudential Life Insurance Co Ltd.
Tiger Global sold over 184 million shares between 25 July and 2 August in the open market. The investor now has a 2.77% stake in Zomato.
Shares of most listed tech startups have also taken a beating amid a ‘funding winter’ and wider concerns about their profitability and valuations. Zomato’s acquisition of Blinkit has also raised worries about its path to profitability.
The company narrowed its net loss to Rs 186 crore during the June quarter from Rs 359 crore a year earlier. Consolidated revenue from operations rose 67% to Rs 1,413.9 crore from Rs 844.4 crore during the period.
Zomato is also moving to a multiple chief-executives structure for its businesses that will be housed under a larger organization called Eternal, Deepinder Goyal, MD & CEO wrote on the company’s Slack channel last month after shareholders approved for the Blinkit acquisition.