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Informist, Monday, Jan. 20, 2025

 

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--Zomato Oct-Dec consol net profit INR 590 mln 
--Analysts saw Zomato Oct-Dec consol net profit INR 2.44 bln 
--Zomato Oct-Dec consol net profit INR 590 mln vs INR 1.38 bln year ago 
--Zomato Oct-Dec consol revenue INR 54.05 bln vs INR 32.88 bln year ago 
--Zomato Apr-Dec consol net profit INR 4.88 bln vs INR 1.76 bln year ago 
--Zomato Apr-Dec consol revenue INR 144.10 bln vs INR 85.52 bln year ago 
--Zomato Oct-Dec tax expense INR 810 mln vs nil year ago 
--Zomato Oct-Dec delivery spend INR 14.50 bln vs INR 10.68 bln 
--Zomato Oct-Dec 'others' under other expense INR 10.83 bln vs INR 5.90 bln 
--Zomato Oct-Dec consol adjusted EBITDA INR 2.85 bln vs INR 1.25 bln yr ago 
--Zomato Oct-Dec food delivery gross order value up 17% on year, 2% on qtr 
--Zomato Oct-Dec quick commerce gross order value up 120% on yr, 27% on qtr 
--Zomato Oct-Dec average monthly customers 10.6 mln vs 5.4 mln year ago 
--Zomato: Oct-Dec avg monthly delivery partners 145 mln vs 73 mln yr ago 
--Zomato Oct-Dec like-for-like going-out gross order value up 119% on year 
--Zomato Oct-Dec like-for-like going-out gross order value up 15% on qtr 
--Zomato Oct-Dec net store additions 216 vs 152 qtr ago 
--Zomato consol cash balance INR 192.35 bln Dec 31 vs INR 108.13 bln Sept 30 
--Zomato: Cash balance up due to net proceeds of INR 84.46 bln from QIP 
--Zomato: Oct-Dec avg/mo delivery partners 480,000 vs 419,000 yr ago 
--Zomato Oct-Dec consol adjusted EBITDA down 14% on qtr 
--Zomato Oct-Dec food delivery adjusted sales INR 24.13 bln, up 17% on year 
--Zomato Oct-Dec quick commerce adjusted sales INR 13.99 bln, up 117% on yr 
--Zomato Oct-Dec hyperpure adjusted revenue INR 16.71 bln, up 95% on year 
--Zomato Oct-Dec going-out adjusted revenue INR 2.59 bln, up 255% on year 
--Zomato Oct-Dec food delivery adjusted EBITDA INR 4.23 bln, up 171% on year 
--Zomato Oct-Dec quick commerce EBITDA loss INR 1 bln vs INR 890 mln loss 
--Zomato Oct-Dec consol EBITDA dn QoQ on higher investment in quick commerce 
--Zomato:Expects to reach target of 2,000 quick commerce stores by Dec 2025 
--Zomato: High competition has paused margin expansion in quick commerce 
--Zomato: Pause in quick commerce margin expansion should be temporary 
--Zomato: Expect quick commerce to continue to make losses in near term 
--Zomato: Quick commerce gross order value seen up over 100% in FY25, FY26 
--Zomato: Food delivery adjusted EBITDA margin seen rising to 5% in few qtrs 
--Zomato: Oct-Dec food delivery EBITDA margin up QoQ on higher platform fee 
 

 

By Steffy Maria Paul and Anand JC

 

MUMBAI – Restaurant aggregator and food delivery company Zomato Ltd.'s net profit for the December quarter slumped 57% on year, contracting for the first time after the company turned profitable in the June quarter of 2023. The company's bottom line missed analysts' estimates by a wide margin on account of a spurt in expenses and tax expenses during the final quarter of 2024.

 

Zomato reported a consolidated net profit of INR 590 million for the quarter, down from INR 1.38 billion a year ago, and lower than the Street's estimate of INR 2.44 billion. The company reported a consolidated revenue of INR 54.05 billion for Oct-Dec, up 64% on year from INR 32.88 billion a year ago. This was Zomato's lowest on-year growth in revenue in nine quarters. The Street estimated a top line of INR 54.43 billion.

 

Sequentially, Zomato's consolidated net profit fell 66%, the highest fall since the company became profitable, while its consolidated revenue rose 13% on quarter. For the nine months to December, the company's consolidated net profit rose almost three times to INR 4.88 billion. It reported a consolidated revenue of INR 144.10 billion, up 68% on year. 

 

The company reported an expense of INR 10.83 billion under 'others' during the quarter, up from INR 5.9 billion during the year-ago quarter. Zomato incurred a current tax expenditure of INR 810 million in the December quarter, against zero tax expenditure during the same quarter a year ago.

 

On Monday, shares of the company closed at INR 239.75 on the National Stock Exchange, down 3.6%. The company reported its earnings during market hours. Zomato had released its September quarter earnings on Oct. 22 after the market hours. Since Oct. 23, the shares have fallen by INR 16.6, or 6.5%.

 

For the December quarter, Zomato reported total expenses of INR 55.33 billion, up 64% on year. Its employee benefit expenses were INR 6.89 billion, up 63% on year. The company's cost for purchase of stock-in-trade almost doubled on year to INR 15.10 billion. Its depreciation and amortisation expenses also almost doubled on year to INR 2.47 billion. Zomato's advertisement and sales promotion expenses for the quarter were INR 5.21 billion, up 40% on year. Its cost for delivery and related charges were INR 14.50 billion, up 36% on year. 

 

Zomato's adjusted earnings before interest, tax, depreciation, and amortisation more than doubled on year to INR 2.85 billion. However, the adjusted EBITDA was down 14% sequentially on account of investments in new store openings and new customer acquisition in the quick commerce business, Zomato said.

 

The company's gross order value of its consumer-facing businesses such as food delivery, quick commerce, and going-out was INR 202.06 billion, up 57% on year. Zomato's gross order value for its food delivery business was up 17% on year and 2% on quarter. Its gross order value for quick commerce business Blinkit, more than doubled on year and rose 27% sequentially. Excluding Paytm's entertainment ticketing business acquired in August, its gross order value for the going-out business more than doubled on year and rose 15% on quarter.

 

Zomato net added 216 stores during the quarter. The company's cash balance as of Dec. 31 rose 60% on year to INR 192.35 billion, largely on account of net proceeds of INR 84.46 billion raised through qualified institutional placement.

 

Zomato's average monthly transacting customers increased to 10.6 million in the December quarter from 5.4 million in the year-ago period. The acquisition cost for these new customers remains attractive, the company said.

 

Average monthly active food delivery restaurant partners increased to 306,000 in the December quarter from 254,000 in the year-ago period. Zomato's average monthly active delivery partners in the December quarter were 480,000, down from 498,000 in the September quarter, but up from 419,000 in the December quarter a year ago.

 

In the December quarter, adjusted sales from Zomato's India food ordering and delivery businesses increased 17% on year to INR 24.13 billion while sales from quick commerce business were INR 13.99 billion, up two-fold from the year-ago quarter. Adjusted revenue for Zomato from its 'going out' segment in the December quarter was INR 2.59 billion, up from INR 730 million a year ago. Revenue from Zomato's business-to-business venture Hyperpure in the final quarter of 2024 was up 95% on-year to INR 16.71 billion.

 

Zomato's quick commerce business Blinkit reported an EBITDA loss of INR 1 billion in the December quarter compared with a loss of 890 million a year ago.

 

Zomato expects losses from this business to continue in the near term. "As we continue to bring forward store expansion, our networks may have to carry a greater load of under-utilised stores which will impact near-term profits in the next one or two quarters," Zomato said. "Once we come out from this period of expansion, the business is likely to turn sharply from being loss making to becoming meaningfully profitable as a larger part of our business starts comprising mature stores compared to newly added ones," Zomato said.

 

Currently, Zomato expects to hit its target of opening 2,000 stores in its quick commerce business by December 2025, a year earlier than its previous guidance. Blinkit added 368 new stores in the last two quarters, around 37% of its total store network. Zomato has incurred a capital expenditure of INR 3.70 billion towards adding 368 net new stores and 1.3 million square feet warehousing space.  End

 

Edited by Akul Nishant Akhoury

 

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