Zomato gets SEBI nod to raise Rs 8,250 crore through initial share

Gurgaon-based Zomato has received markets regulator Sebi's nod to raise Rs 8,250 crore through an initial share-sale.

The initial public offer (IPO) comprises fresh issue of equity shares worth Rs 7,500 crore and an offer-for-sale to the tune of Rs 750 crore by Info Edge (India) Ltd, according to draft red herring prospectus, reported PTI.

The food delivery platform that filed preliminary IPO papers with Sebi in April, obtained its observation on July 2, an update with the regulator showed on Monday.

Also Read: Zomato files documents with SEBI, to raise Rs 8250 crore via IPO

Going by the draft papers, proceeds from the fresh issue would be used towards funding organic and inorganic growth initiatives; and general corporate purposes.

With Covid-19 pandemic, the growth for online food delivery and tech market has disrupted like never before and it has been growing ever since to a new heights with Swiggy and Zomato leading the sector.

Zomato's 2019-20 revenue had jumped over two-fold to $394 million (around Rs 2,960 crore) from the previous fiscal year, while its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) loss was around Rs 2,200 crore.

In February, Zomato had raised $250 million (over Rs 1,800 crore) in funding from Tiger Global, Kora and others, valuing the online food ordering platform at $5.4 billion.

Kotak Mahindra Capital Company, Morgan Stanley India Company Pvt Ltd and Credit Suisse Securities (India) Pvt Ltd are the global coordinators and book running lead managers to the issue.

May Interest: Gurgaon-based Zomato to file IPO in April

BofA Securities India Ltd and Citigroup Global Markets India Pvt Ltd have been appointed as merchant bankers to the public issue. The shares the company will be listed on BSE and NSE.