Shares of Indian food delivery giant Zumato hit the market on Friday after an IPO of Rs 93.75 billion (9 916.6 million), the country’s largest this year.
As many as 30 Indian companies have announced plans to list shares this year, with startups attracting billions of dollars in investment, although many companies have yet to make a profit.
Zomato, which counts Chinese tycoon Jack Ma’s brick group and Uber subsidiaries among its shareholders, dominates the rival Sugi as well as India’s fast-growing app-based food delivery space.
Its shares debuted at Rs 115 on the BSE Sensex index, which is 51 per cent higher than its current price after its IPO was subscribed 40.38 times last weekend.
The stock then rose 80 percent in the first 10 minutes, pushing Zomato’s market capitalization to over Rs 1 trillion.
India’s economy has been devastated by epidemics, with its worst annual recession since independence in 1947.
This year alone, about 20 “unicorn” firms worth more than 1 1 billion have been formed, including half a dozen in four days in April.
Many are struggling to recruit qualified staff, some have reportedly offered talent such as free motorbikes and tickets to cricket matches.
This is India’s best year for an IPO. Others on the list include the digital payments firm Paytm, which is supported by Japan’s Softbank and Ma.
Many startups are at a loss, though.
For example, Zomato, which operates in 525 Indian cities, is not yet profitable and has lost Rs 8.16bn in the financial year ended March 2021.
“We are going to focus on 10 consecutive years and beyond, and will not change course for short-term profits at the expense of the company’s long-term success,” Zumato chief executive Dipendra Goel said Friday. .
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