India-based food delivery start-up Zomato is likely to raise $750m to $1bn through initial public offering (IPO).
The amount is likely to be raised without exit of any investor or share sales, The Economic Times reported.
The company would be among the first start-ups in India to go public in 2021.
Zomato co-founder and CEO Deepinder Goyal told staff that the IPO would ‘most probably be 100% primary offering’, given that investors would want to keep their stock for the long term.
Addressing employees, Goyal said: “This means the company will end up raising more capital, rather than shareholders offloading stock in the open market.
“No existing shareholder is willing to sell any shares in our IPO. People think that Zomato will be a $50bn company in five years, I hope, and it will be unwise to sell shares right now.”
Among the current existing investors of Zomato are Tiger Global, Temasek Holdings, Sequoia Capital, and Info Edge (India).
Zomato is likely to launch its IPO in June for a valuation of $6bn to $8bn.
Its competitor Swiggy is also raising fresh capital of $800m.
The online restaurant aggregator has struggled due to the downturn from the Covid-19 pandemic. It laid off employees, reduced pays, and withdrew from several cities during the lockdown. However, following the lifting of the lockdown, it has been offering sharp discounts for food delivery and introduced contactless dining to survive the economic consequences of the pandemic.