Zomato hopeful of turning profitable within one year
- Deepinder Goyal, founder and CEO of Zomato, said the firm will reduce cash burn
Zomato is likely to turn profitable within a year, the company’s management said at its first annual general meeting post-listing on Tuesday.
Akshant Goyal, chief financial officer, Zomato told shareholders: “At the company level we should break even in six months to a year…without (excluding) Blinkit which will take a bit longer,” Moneycontrol report said quoting Goyal.
As reported by Mint in May, Goyal has been focusing on profitability. “We want to get to profitability without diluting. That’s how we’re thinking about it. With the $1.6 billion we have in the bank, we should get to a profitable business on an aggregate basis… on a group basis,“ Goyal had told analysts during Zomato’s first financial earnings call post-listing.
With both private and public investors asking companies to aim for strong unit economics and profitability, new-age companies are tweaking strategies and reducing cash burn.
During the earnings call, Zomato’s founder and chief executive Deepinder Goyal had said it will not spend most of the funds by the time it turns profitable. “In FY18-19, it was all about acquiring users who were new to this category.”
More than 90% of Zomato’s business has been from repeat customers. The Ant Group-backed firm incurred a net loss of ₹359 crore in FY22 despite 75% revenue growth.
It has been working on various new initiatives to bring in horizontal growth. Apart from buying grocery delivery platform Blinkit (formerly Grofers), Zomato has introduced intercity food delivery services across select cities in India.
Zomato’s shares are currently trading at ₹58.3 apiece, at a discount of over 20% to the issue price of ₹76 a share.
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First Published:31 Aug 2022, 01:47 AM IST
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