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Zomato IPO: Indian Food Delivery ‘Unicorn’ Opens $1.2 Billion Offering

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Shares in food delivery app Zomato, one of India’s biggest tech start-ups, have gone on sale in its $1.2 billion (£870m) initial public offering (IPO).

India has been producing unicorns, private firms valued at over $1 billion, at a rapid pace. Zomato is one of them. It raised $562.3 million from institutional investors although analysts were wary of the loss-making company’s high valuation. The company is backed by Jack Ma’s Ant Group and is the first of India’s major digital start-ups to IPO, with more expected.

The company has been launched in 2008 and offers services such as food delivery and curates restaurants reviews. It is available in 525 cities and caters to some 6.8 million customers every month and has even become a household name in India.

Zomato’s three-day offering is expected to increase the company value up to $9 billion since its share are priced 72 to 76 rupees per share. The trade in stocks is expected to start on 27 of July.

Ahead of Wednesday, the company has allotted share worth $562.3 million to about 200 foreign and domestic investors. Private firms such as Tiger Global and BlackRock are among the investors together with the some of the country’s biggest banks such as State Bank of India, Kotak, ICICI and HDFC.

The pandemic and lockdown which have been exposed to the country have affected the company and its revenue for the financial year ending March 2021 was down by 23.4% from the previous year.

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