Zepto's Confidential IPO Filing Strategy Aims to Shield Financial Data from Competitors

Zepto cofounder Aadit Palicha has provided insights into the company's strategic decision to pursue a confidential IPO filing route, citing competitive advantages and the need to protect sensitive financial information from rivals in the highly contested quick commerce sector. Strategic Rationale Behind Confidential Filing Speaking at Samvad, Palicha explained that the confidential filing approach allows Zepto to initiate the SEBI process early while maintaining flexibility to refine documentation as financial performance evolves. "For a company like us, the difference between one quarter to another could be 50% growth," he stated, emphasizing the dynamic nature of the business. The strategy provides Zepto with operational advantages in a competitive landscape. By filing privately, the company can present the most current financial picture to investors without revealing quarterly performance metrics to competitors during the intense market battle. IPO Structure and Financial Details Zepto's public offering plans involve substantial capital mobilization and institutional support: Parameter: Details Fresh Issue Target: ₹11,000 crores Shareholder Approval: December 23, 2024 Expected Listing: September 2025 Filing Process Status: "Very positive" and "very smooth" The company has assembled a comprehensive banking consortium including Morgan Stanley, Axis Capital, HSBC, Goldman Sachs, JM Financial, IIFL Securities, and Motilal Oswal to manage the offering. An offer for sale from early investors is also expected as part of the overall structure. Competitive Landscape and Market Dynamics The IPO comes amid intensified competition in the quick commerce space, with major players securing significant funding rounds. Recent capital raising activities by competitors highlight the sector's capital-intensive nature: Company: Recent Fundraising Amount Swiggy: QIP for quick commerce ₹10,000 crores Zomato: QIP in November 2024 ₹8,500 crores Zepto: October 2024 round $450 million Zepto competes directly with Swiggy Instamart and Zomato's Blinkit, alongside emerging threats from Amazon, Flipkart Minutes, and BigBasket. The sector has also faced scrutiny regarding labor practices, with gig workers recently protesting against major platforms over payout structures and delivery timelines. Company Evolution and Financial Performance Founded by Palicha and Kaivalya Vohra, Zepto began operations in mid-2020 as KiranaKart, initially offering 45-minute deliveries through local kirana stores. The company pivoted to a dark-store model and rebranded as Zepto in April 2021, launching 10-minute delivery services in Mumbai before expanding to major cities nationwide. Zepto's financial trajectory shows substantial revenue growth alongside ongoing losses typical of the sector: Financial Metric (FY24): Amount Operating Revenue: ₹4,454 crores Net Loss: ₹1,249 crores Total Funding Raised: Over $2.45 billion The company has attracted investment from prominent venture capital firms including Lightspeed Venture Partners, Y Combinator, and Nexus Venture Partners. Following the October fundraise, Zepto resumed expansion activities and eliminated handling and delivery fees for most orders after a period of cost-cutting measures. If the listing proceeds as planned by September 2025, all three major quick commerce players in India would be publicly traded, marking a significant milestone for the sector within six years of Zepto's incorporation. Quick commerce platform Zepto has confidentially filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering worth $1.30 billion (₹11,000-12,000 crore). The Aadit Palicha and Kaivalya Vohra-led company received shareholder approval at an extraordinary general meeting on December 23, clearing the path for its public market debut and making it one of the youngest startups to tap the public markets. IPO Structure and Timeline The IPO is expected to raise approximately $1.30 billion, with ₹11,000.00 crore coming from fresh equity capital and the remaining portion comprising an offer for sale by early investors. Zepto is targeting its stock market listing between July and September 2026, which would make it the youngest company to hit the Indian public markets at just four years old. Earlier startups such as Ola Electric and Honasa Consumer went public six to seven years after incorporation. IPO Parameter: Details Total IPO Size: $1.30 billion (₹11,000-12,000 crore) Fresh Capital: ₹11,000.00 crore Target Listing Period: July-September 2026 Filing Type: Confidential DRHP Current Valuation: $7.00 billion Investment Banking Consortium Zepto has assembled a strong consortium of investment banks to manage its public offering. The company has appointed Morgan Stanley, Axis Capital, HSBC, Goldman Sachs, JM Financial, IIFL Securities, and Motilal Oswal as book running lead managers for the IPO issue. The confidential filing route, also taken by companies like Swiggy, Meesho and Groww, provides Zepto with flexibility to revise its IPO size before the final launch. Financial Performance Shows Strong Revenue Growth Zepto's latest financial results demonstrate significant business expansion. According to regulatory filings, the company's revenue rose sharply to ₹9,669.00 crore in FY25, representing a 129.00% year-on-year increase. However, the company's net loss nearly tripled to ₹3,367.00 crore from ₹1,214.00 crore in the previous year, reflecting the high cash burn typical of the quick commerce sector. Financial Metric: FY25 FY24 Change Revenue: ₹9,669.00 crore ₹4,219.00 crore +129.00% Net Loss: ₹3,367.00 crore ₹1,214.00 crore +177.00% Strategic Corporate Developments and Market Competition The company has undertaken several strategic moves to prepare for its public listing. Zepto moved its corporate domicile back to India from Singapore in January, aligning with regulatory requirements for Indian market listing. The fundraising will strengthen the company's balance sheet as it competes against established players including Blinkit, Swiggy Instamart, Flipkart Minutes and Amazon Now. As of late November, Zepto had around ₹7,000.00 crore in cash, while competitors like Blinkit's parent Zomato and Swiggy each have ₹17,000-18,000 crore on their books. Following its October fundraising, Zepto stepped up competition by offering higher discounts and removing various platform fees to boost order numbers. Company: Cash Position (₹ Crore) Zepto: 7,000.00 Zomato/Swiggy: 17,000-18,000 each Market Position and Future Outlook Zepto closed a $450.00 million funding round in October through a mix of primary and secondary transactions, led by US-based pension fund CalPERS, which valued the company at $7.00 billion. According to a September note by BofA Securities, Blinkit holds more than 50.00% of the quick commerce market share, with rivals Zepto, Instamart, BigBasket, Flipkart Minutes and Amazon Now accounting for the rest. After a strong listings season in 2025, several other new-age companies, including PhonePe, Flipkart, Shadowfax, Shiprocket and Curefoods, have lined up to go public next year. Based in Bengaluru, Zepto operates in India's competitive quick commerce landscape, competing with established players like Swiggy and Zomato, both of which are already listed on Indian stock exchanges. We’re building Scanx - to help you express your trading & investing idea, to help you analyse the markets better. Stock Markets are the true indicator of the growth of any country's economy. We are bullish on India, we are bullish on India's prospects to be one of largest economies of the world. We believe that Stock Markets provide an unique opportunity for all Indians to participate in the growth story of India. We are enabling the same for Indians. As financial services are becoming more accessible, there is now a large set of Indians today who are financially aware and literate. They value time and seek high quality products & services. Most screening, trading, investing platforms available today are more or less similar to each other, and they have not evolved with time. 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