SoftBank to sell Zomato shares worth Rs 1,000+ Cr on Oct 20; Blinkit's FY23 revenue surges

SoftBank's Vision Fund (Growth) currently holds 2.2% stake in food delivery firm Zomato.

SoftBank to sell Zomato shares worth Rs 1,000+ Cr on Oct 20; Blinkit's FY23 revenue surges

Thursday October 19, 2023,

3 min Read

SoftBank is likely to sell part of its stake in food delivery company Zomato worth over Rs 1,000 crore on Friday, as per a report by Moneycontrol.

SoftBank's Vision Fund (Growth) currently holds a 2.2% stake in Zomato and is expected to shed 1.1% of its holding on October 20 via a block deal, the report said.

The deal is expected to be offered at a floor price in the range of Rs 109.4-111.65 per share, which could be either at no discount or 2% lower than Thursday's closing price, according to the report.

Kotak Mahindra Capital was the broker of the transaction, according to the media report.

YourStory could not independently verify the development.

In August, SoftBank offloaded shares worth Rs 940 crore in the Deepinder Goyal-led firm through a block deal and sold a 2.54% stake in PolicyBazaar parent PB Fintech for Rs 876 crore in October.

Tiger Global's Internet Fund III sold its remaining stake in Zomato in August 2023 worth Rs 1,123 crore by offloading 12.34 crore shares at Rs 91.01 apiece, as per bulk deals data available on BSE.

Blinkit's earnings

Meanwhile, Zomato's grocery delivery arm Blinkit recorded a 207% rise in operating revenue to Rs 724 crore in FY23 compared to the previous financial year. It earned Rs 236 crore in revenue from operations in FY22.

The numbers represent Blinkit's first full-year numbers since its acquisition by Zomato.

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However, the quick commerce firm's total expenses rose 53% to Rs 1,939 crore from Rs 1,262 crore on the back of higher delivery-related and employee expenses, according to financials sourced by Private Circle Research, a private market intelligence platform.

Zomato acquired Albinder Dhindsa-led Blinkit in June 2022 in a deal valuing the quick-commerce platform at $626 million, marking the food delivery's entry into the fiercely competitive quick-commerce sector.

Zomato posted a first-time profit of Rs 2 crore in the April-June quarter of FY24, much earlier than its previous guidance where it said it expects to hit the milestone by Q2 FY24.

In its statement to shareholders in August, Zomato said it aims to hit adjusted EBITDA breakeven for Blinkit in the next four quarters. The company defines adjusted EBITDA as EBITDA plus share-based payment expense minus rental paid for the period as per IAS 116.

The quick commerce segment expects to see year-on-year gross order value (GOV) growth of more than 60% with improvement in unit economics. Dhindsa had noted in August that Blinkit saw its highest-ever GOV and transacting customers in June and July.

Blinkit's GOV is very close to Zomato's GOV in some large cities and the quick-commerce firm is likely to drive more value than Zomato in the next 10 years, according to CEO Deepinder Goyal.

Zomato's shares on Thursday ended 1.59% lower to settle at Rs 111.40 apiece.

Edited by Kanishk Singh