Ant Group-backed food aggregator platform Zomato Ltd has sharply narrowed its consolidated losses to Rs 67.2 crore in the third quarter of FY22 to Rs 352.6 crore. The losses were also lower sequentially from Rs 435 crore in the second quarter.
This was helped by a one-time gain of Rs 315.8 crore from the sale of its stake in Fitso, an online platform that connects people to sporting venues.
Zomato's dining out business, which provides discounts and offers to customers when they eat out at partner restaurants, strengthened as eateries and bars reopened after the lockdown eased due to a fall in Covid-19 cases during the quarter.
Its revenue from operations jumped over 82% at Rs 1,112 crore as compared to Rs 609.4 crore in the year ago quarter. However, sequentially, it only inched up from Rs 1,024 crore.
On Thursday, Zomato’s shares ended almost flat at Rs 94.50, up marginally by 0.32% at the end of day’s trade.
The company's gross order value (GOV) grew by 84.5% year-on-year and 1.7% quarter-on-quarter to Rs 5,500 crore in the reporting quarter.
GOV is defined as the total monetary value of all food delivery orders placed online on Zomato in India including taxes, customer delivery charges, gross of all discounts, excluding tips.
On a sequential basis, the GOV grew by a marginal 2%, mainly due to reduction in customer delivery charges, in addition to a soft impact of post-Covid reopening (including some shift from delivery to dining out).
Cash and investments
The company has around $1.7 billion cash on its balance sheet, which it plans to utilise to focus on two key areas of investment in our business – core food businesses and quick commerce.
“We made cash investments worth ~$225 million in the past year across three companies - Blinkit (erstwhile Grofers), Shiprocket and Magicpin – towards our objective of building out quick ecommerce in India… Of these investments, Blinkit is the closest to how we all know the quick commerce business today,” it further said.
The private equity-backed food delivery firm which got publicly listed in July 2021 had raised Rs 8,728 crore from fresh issue of equity shares. Of these, it utilised Rs 3,267 crore as on December end 2021, the company said in its financial statement.
On a standalone basis, Zomato reported a loss of Rs 99 crore as compared to Rs 388.4 crore a year ago and Rs 414 crore in the preceding quarter.
During the quarter ended December, 2021, the Group (Zomato Limited and its subsidiaries) acquired the remaining 35.44% stake in Jogo Technologies Pvt Ltd from the remaining shareholders and sold full 100% stake in Jogo Technologies Pvt Ltd to Curefit Services Private Limited and Curefit Healthcare Pvt Ltd for a total consideration of Rs 37.5 crore.
“Owing to the outbreak of the global pandemic Covid-19. the governments across the globe deployed varied degrees of measures including lockdown and restrictions on movement which had a negative impact on the food and entertainment sector. This in turn had impacted the Group’s operations since dining out in restaurants was suspended which led to demand for advertisement and memberships subscriptions across dining out restaurants slowing down,” said Zomato Ltd (formerly known as Zomato Private Limited and Zomato Media Private Limited).
The parent Zomato group has 36 subsidiaries and one joint venture Zomato Media and an associate ZMT Europe.
Zomato is backed by investors include Sequoia Capital, Info Edge, Alibaba Group’s Ant Financials, Tiger Global, Kora Investments, Nexus Ventures and Temasek Holdings.