Ant-backed Zomato Loses $1.1-billion Market Value In Just Two Days

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lost about $1.1 billion of market value in two days after the food-delivery platform announced the acquisition of loss-making quick-commerce firm Blink Commerce – a move some analysts said will weigh on future growth.

– among the first-generation of internet unicorns to tap into India’s capital market – tumbled 8.4 per cent in Mumbai trading on Tuesday on top of a 6.6 per cent drop on Monday.

The two-day fall to Rs 60.3 put shares 21 per cent below the initial public offering (IPO) price.

The acquisition will increase Zomato’s operating loss to fund activities of Blink and its Blinkit application, “shifting the path to profitability back by another year”, Rahul Jain, an analyst at Dolat Capital Market, said in a note.


The successful listing of last year set the tone for IPOs of a number of Indian unicorns, including digital-payments firm Paytm’s parent One97 Communications. However, doubts have been raised about the valuations of the so-called new-age technology firms – as well as about their business models – with many companies still making losses and turning to the inorganic route of acquisitions to expand.

Zomato, backed by and Jack Ma’s Ant Group Co. (formerly known as Ant Financial), among others, first invested in Blink in August 2021.

The company said the acquisition will help it increase its hyperlocal delivery fleet and reduce some costs.

The acquisition widens Zomato’s scope beyond food delivery and “highlights the management’s broader ambitions of capturing a larger slice of India’s $1.3-trillion commerce market”, Swapnil Potdukhe, an analyst at JM Financial Institutional Securities, said in a note.

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