Online Food Delivery platform Zomato went public with its IPO on July 14th. With an ambitious target, even considered an overvaluation by experts, the company has gained a lot of traction in the market. Despite its loss-making status and a lot of talk regarding the 72-76 rupee price point of the stock, many investors are flocking to the company. Here are some of the important information regarding the IPO.
Subscriptions and Allotments
The Zomato IPO was subscribed a whopping 38 times. Qualified Institutional Buyers bid almost 54 times the quotas reserved for them, while retail investors clocked at 7.45 times and non-institutional buyers at 35 times. The registrar for the IPO is Link Intime India Pvt Ltd, and the share allocations can be checked on their website, or directly from the BSE Website.
The warm reception towards Zomato’s IPO is indicative of the preferences of modern investors. Despite being a loss-making company on net profits and EBITDA level, the company has seen a record high rate of subscription. And despite the initial concerns of the price being overvalued, Zomato has managed a bumper listing.
As the first domestic tech startup to list in the stock exchange in recent times, a lot of eyes were on Zomato. The outcome of the Zomato IPO shows the leaning of investors towards tech firms and a focus on businesses with considerable future scope. Though the company currently operates at a loss, the traction gained from the IPO along with favourable market conditions is expected to push it to minimal losses, starting to profit in the future.
The IPO is also indicative of a bigger picture of the Indian Investment sphere, especially for other tech startups. The positive reception for Zomato’s IPO shows the fertile climate for tech startups and even loss-making tech companies. The pandemic may have played a role in this shift, boosting the overall tech penetration among the public and popularizing online alternatives like Zomato. This IPO has encouraged many emerging technology startups to enter the stock market.
Just two days after Zomato launched its IPO, digital payments firm Paytm filed for India’s biggest tech IPO planning to raise as much as $2.2 billion.
Overall, the future looks bright for the Indian startup ecosystem.