Food-delivery platform Zomato on Thursday posted its third consecutive quarter of net profit at Rs 138 crore in the three months ended December, compared to a loss of Rs 347 crore in the year-ago period. Consolidated revenue from operations during the quarter rose 69% year-on-year to Rs 3,288 crore.
Both profit and revenue were above Bloomberg consensus estimate of Rs 86 crore and Rs 3,100 crore, respectively. The growth was mainly broad-based across its business segments – food-delivery, B2B arm Hyperpure and quick-commerce arm Blinkit – driven by significant rise in its gross order value.
Its largest segment – food delivery – posted a growth of 29% year-on-year in its adjusted revenue to Rs 2,025 crore. The company’s adjusted revenue includes revenue from operations and customer delivery charges paid for food delivery, net of any discounts offered including free delivery under Zomato Gold.
The segment’s contribution margin improved to 7.1% in Q3 from 5.1% a year ago, resulting in a jump in the segment’s adjusted Ebitda to Rs 252 crore from just Rs 23 crore a year ago. The margin expansion was aided by rising ad revenue per order and platform fee.
Overall, Zomato’s adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) for Q3 came in at Rs 125 crore, compared to a loss of Rs 265 crore a year ago.
Gross order value in its food delivery business rose 27% on year to Rs 8,486 crore, but came below the company’s expectations, it said in its shareholder letter, citing weak demand environment even for the broader restaurant industry.
However, with GOV growth returning to above 25%, the company expects it to continue growing at 20%+ year-on-year, while it may rise further with better-than-expected market share gains and revival in macro consumer demand.
Meanwhile, sales in its smaller segments – Hyperpure and Blinkit – more than doubled in the December quarter. Blinkit’s revenue rose 114% year-on-year to Rs 644 crore in Q3, driven by robust uptick in demand due to multiple festivals during the quarter.
The company added 40 new dark stores or micro fulfillment centres during the quarter, taking the total number to 451.
The company said it is on track to achieve break-even for this segment by Q1 FY25. Blinkit also recorded its scond consecutive quarter of positive contribution margin at 2.4%, while its gross order value doubled year-on-year to Rs 3,545 crore.
“While most of the GOV growth was order volume-led, part of it was also driven by an increase in average order value, which continued to benefit from a higher mix of high ASP (average selling price) categories such as electronics, festive needs, home décor, among others,” it said.
As for Hyperpure, the segment recorded a 104% rise in revenue to Rs 859 crore in Q3, driven by core restaurant supplies business and the relatively newer quick commerce opportunity. The company said it will set up a plant for processing value-added food supplies including, sauces, spreads, pre-cut and semi-finished perishable products, among others.
On Thursday, Zomato’s shares closed up 2.42% at Rs 144 on the BSE.