In January 2020, Uber announced that it had sold the India business of Uber Eats
for a 9.99 per cent stake in Zomato. Uber sold its Indian food delivery business to Zomato for $206 million.
The Covid-19 pandemic and the resultant nation-wide lockdown
hit the firm in March 2020, bringing down order volumes significantly, according to the documents. This also caused a huge reduction of the dine out revenue.
“We are working on a number of products to address this loss, like introducing contactless dining and delivery/takeaway products in certain geographies outside of India,” according to the documents.
Zomato’s ‘food@work’ business under the entity Tonguestun Food Network Private Limited (cafeteria meals business) is also impacted due to Covid-19, as a large number of working people have been working from home. This has resulted in trimming down of the business in line with current market requirements. Decisions to continue in cities or not for the delivery business were also taken after analysing the market potential and profitability.
According to the independent auditor’s report, mentioned in the documents, it was highlighted that the pandemic Covid-19 would cause various economic and social disruption to the company, impacting investments, trade receivables, goodwill and intangible assets.
According to the documents, business is shaping up well for the company and the management team is focused to improve the product continuously striving to focus on customer satisfaction and ensuring to grow without compromising on profitability.
The documents said the directors expect that with an increased focus on the relevant geographies for business in future and closure of the non-operative business entities including subsidiaries and branches, along with the focus on increasing the operational efficiency, the overall business of the company will improve in the coming years.
The company also closed step-down subsidiaries in countries such as Austria, Romania and Norway. During the financial year, the foreign exchange inflow was reported as Rs 270 crore and the outgo was Rs 252 crore.
During the financial year under review, the ICC (internal complaints committee) has received 11 complaints for sexual harassment, among which two were pending and were resolved after the closure of the financial year.
Covid-19 has now accelerated the journey of foodtech companies
to profitability. After initial hiccups, Zomato is rapidly coming out of th pandemic's shadows. With people opting to stay at home due to Covid-19-related restrictions and curfews in several cities, Zomato and its rival Swiggy
witnessed orders shooting through the roof on New Year’s Eve. as people ordered biryanis, pizzas and cakes. Zomato served 4,254 orders per minute during peak time and Swiggy
recorded peak number of orders per minute at 5,500 on Thursday night, according to sources.
December 2020 was also expected to be one of the highest ever GMV (gross merchandise value) month in Zomato’s history. It was clocking about 25 per cent higher GMV than its previous peaks in February 2020. Zomato recently closed a $660 million primary financing round at a post-money valuation of $3.9 billion. The firm is also now focusing on launching its nutrition business. Zomato is planning an IPO (initial public offering) this year.
Zomato’s financials (consolidated basis)
Rs 2,743 crore revenues for FY 2019-20.
100% jump since the last financial year.
Rs 2,386 crore net loss.
138% increase from the last financial year.
Rs 5,006 crore, expenses for the fiscal.
39% increase from the previous year.
4,254 orders served by Zomato per minute during peak time on New Year’s Eve.
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