[MUMBAI] Zomato, an Indian food delivery startup, will file for an initial public offering (IPO) in the first half of 2021, joining a rash of consumer internet companies raring to go public.
"Our finance/legal teams are working hard to take us to IPO sometime in the first half of next year," Deepinder Goyal, Zomato's founder and chief executive officer, told employees in an email on Thursday, a copy of which Bloomberg News has obtained. In response to a query, Mr Goyal declined to comment on the size of the IPO or the valuation.
Technology companies are set to raise more capital via IPOs in 2020 than at the height of the dotcom bubble, an extraordinary showing in a year fraught with uncertainty.
Zomato, backed by Sequoia Capital and Jack Ma's Ant Group among others, represents a clutch of high-flying Indian startups now riding a smartphone boom in the world's second-most populous nation.
The company continues to seek funds ahead of its envisioned debut. Global investors Tiger Global Management, Temasek Holdings, Baillie Gifford and Ant have joined Zomato's latest financing round, he added.
"There are more big names joining the round - we estimate that our current round will end up with us at US$600 million in the bank very soon," Mr Goyal said in the same note.
The investors are part of a US$525 million round that, as per a filing with India's company regulator, values the startup at US$3.4 billion.
Zomato is among the two largest players in India's food delivery business. It's locked in a fierce fight with rival unicorn Swiggy, which is backed by the likes of Tencent Holdings, Naspersand DST Global among others.
Both startups faced challenging business conditions during the coronavirus pandemic and ensuing lockdowns, but are continuing to win global investor support.
Swiggy raised over US$100 million from Naspers earlier this year.
Food delivery is beginning to bounce back as Indians continue to order food via apps in a country with half-a-billion smartphones and with restaurants still shuttered for walk-in customers.
"The best part is that our burn rate is very low and our market share is accelerating in all regions," Mr Goyal said in the note to employees.
"We have no immediate plans on how to spend this money. We are treating this cash as a 'war chest' for future M&A (mergers and acquisitions) and fighting off any mischief or price wars from our competition in various areas of our business."