{"id":35939,"date":"2024-04-26T08:19:38","date_gmt":"2024-04-26T08:19:38","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/04\/26\/blinkit-contributes-more-to-zomatos-market-cap-than-its-food-delivery-biz-goldman-sachs\/"},"modified":"2024-04-26T08:19:38","modified_gmt":"2024-04-26T08:19:38","slug":"blinkit-contributes-more-to-zomatos-market-cap-than-its-food-delivery-biz-goldman-sachs","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/04\/26\/blinkit-contributes-more-to-zomatos-market-cap-than-its-food-delivery-biz-goldman-sachs\/","title":{"rendered":"Blinkit contributes more to Zomato\u2019s market cap than its food delivery biz: Goldman Sachs"},"content":{"rendered":"
\"Blinkit<\/div>


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Quick-commerce platform Blinkit<\/a>\u2019s contribution to parent Zomato<\/a>\u2019s market value has surpassed that of the mainstay food-delivery business, according to a Goldman Sachs<\/a> report.
The report estimates Blinkit\u2019s implied value at Rs 119 per share, compared with Rs 98 a share for Zomato\u2019s food delivery<\/a> business. This translates to a contribution of $13 billion by Blinkit to Zomato’s value, up from $2 billion in March 2023, as per Goldman Sachs. As of Friday, Zomato had a market capitalisation of nearly $20 billion.<\/p>\n
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On Friday noon, Zomato\u2019s shares were trading at Rs 188.35 on the BSE, 1.9% higher from the previous close.<\/p>\n

Zomato had acquired Blinkit in 2022 <\/a>for around $570 million in an all-stock deal. The quick commerce firm was backed by SoftBank, Tiger Global and Sequoia Capital India (now Peak XV Partners).<\/p>\n

Over the last six months, analysts and brokerages have predicted the upside in Zomato\u2019s stock price to come from expansion in the fast-growing quick-commerce segment. Since end-October, the company\u2019s share price has gained by almost 80%.<\/p>\n

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Goldman Sachs in its report said it also expects Blinkit\u2019s gross order value (GOV) and earnings before interest, taxes, depreciation and amortisation (Ebitda) to be higher than that of food delivery by fiscal 2029.<\/p>\n

Meanwhile, it expects Zomato\u2019s food-delivery business to grow at 15-20% on-year in the foreseeable future.<\/p>\n

In the October-December quarter of FY24, Zomato\u2019s food-delivery business reported a GOV of Rs 8,486 crore<\/a>, 27% higher year-on-year. Blinkit\u2019s GOV came in at Rs 3,542 crore, up 103%.<\/p>\n

\u201cWe note that Blinkit\u2019s growth has been consistently tracking higher vs our expectations, and we have raised our FY25 GOV estimates for Blinkit by around 50% over the last 12 months,\u201d Goldman Sachs said. \u201cAlso, Blinkit\u2019s margin profile has been improving faster vs our expectations.\u201d<\/p>\n

In March, Zomato chief executive Deepinder Goyal said that Blinkit could become bigger than Zomato<\/a> (food delivery) in a year.<\/p>\n

Competition concerns<\/strong>
Quick-commerce platforms could continue taking share from unorganised retail on the back of \u201csubstantial\u201d pricing advantage and higher number of items on offer, the investment bank said.<\/p>\n

ET had reported in February that at a time when the quick-commerce segment was witnessing a surge in growth,<\/a> India’s neighbourhood grocery stores \u2014 numbering around 12 million \u2014 were facing an intensified slowdown in sales.<\/p>\n

Goldman Sachs said of the $11 billion online grocery industry in FY24, quick commerce had already made up for nearly 50%.<\/p>\n

\u201cGiven the size of the industry, we expect competition to be a consistent feature of the online grocery industry, with no player likely having a more than 20% market share,\u201d it said.<\/p>\n

In the quick-commerce space, Blinkit\u2019s rivals include Swiggy Instamart, Nexus Venture Partners-backed Zepto and Tata Group-owned BigBasket\u2019s BB Now.<\/p>\n

On April 17, ET reported, citing a report by HSBC Global Research, that Blinkit\u2019s market share rose from 32% in March 2022 to 40%<\/a> in January 2024. <\/p>\n

In the same period, Instamart\u2019s market share fell from 52% to 32%, while Zepto\u2019s increased from 15% to 28%.<\/p>\n<\/div>\n


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Quick-commerce platform Blinkit\u2019s contribution to parent Zomato\u2019s market value has surpassed that of the mainstay food-delivery business, according to a Goldman Sachs report.The report estimates Blinkit\u2019s implied value at Rs 119 per share, compared with Rs 98 a share for Zomato\u2019s food delivery business. This translates to a contribution of $13 billion by Blinkit to […]<\/p>\n","protected":false},"author":2,"featured_media":35940,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","fifu_image_url":"https:\/\/img.etimg.com\/photo\/msid-42031747\/et-logo.jpg","fifu_image_alt":"","footnotes":""},"categories":[607],"tags":[28366,3668,38997,3962,38998,15352,1720,36174,29532,31390,1602,31393,4206,38999],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/35939"}],"collection":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/comments?post=35939"}],"version-history":[{"count":1,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/35939\/revisions"}],"predecessor-version":[{"id":35941,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/35939\/revisions\/35941"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media\/35940"}],"wp:attachment":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media?parent=35939"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/categories?post=35939"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/tags?post=35939"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}