Zomato will invest Rs 300 crore in its quick commerce subsidiary Blinkit, as per regulatory filings sourced from Tofler. This will raise Zomato’s total investment in Blinkit, acquired in 2022 for $569 million in an all-stock deal, to Rs 2,300 crore. According to various media reports, Zomato will invest Rs 100 crore in Zomato Entertainment, its live events and ticketing business.
Following the announcement of its Q4 FY24 results, Zomato stated that Blinkit plans to expand its store footprint to 1,000 by the end of FY25, up from 526 stores as of March 31, 2024, with 75 stores added in Q4.
The increased investment underscores Blinkit’s growing importance to Zomato’s business strategy. In 2021, Zomato acquired a 9% stake in Blinkit (then known as Grofers) for $100 million, and fully acquired the company the following year. Zomato CEO Deepinder Goyal highlighted the potential of quick commerce, marking it as a priority for the company.
Blinkit’s gross order value (GOV) doubled to Rs 4,027 crore in Q4 FY24 from Rs 2,046 crore in the same quarter the previous year, reflecting a 13.7% sequential growth. In comparison, the GOV for Zomato’s food delivery segment grew 28% to Rs 8,439 crore but saw a slight sequential decline of 0.6%.
Currently, Blinkit leads the quick commerce market, followed by Swiggy Instamart and Zepto. The acquisition by Zomato came as a distress sale at Rs 4,447 crore, nearly half of Blinkit’s earlier valuation. This new capital infusion coincides with Zepto’s ongoing fundraising efforts and Flipkart’s entry into the quick commerce space. Swiggy is also intensifying its focus on its quick commerce arm, Swiggy Instamart, according to media reports.