Food tech firm, Zomato on Saturday said that it will wind up its Slovakian subsidiary and has initiated the process of liquidation.
In a regulatory filing, the company said that the liquidation process commenced on September 14 and will likely be completed within 9-12 months, subject to requisite approvals.
Zomato had entered into the Slovakian market in 2014 post acquiring online restaurant discovery guide Obedovat.sk. “Zomato Slovakia, (a) step down subsidiary of Zomato Limited situated in (the) Slovak Republic, has initiated the process of liquidation on September 14, 2023… It may be further noted that… the dissolution of Zomato Slovakia will not affect the turnover/revenue of the company,” said Zomato in a regulatory filing with the BSE.
Zomato pegged the Slovakian arm’s net worth at around `2.2 lakh. The move by the food tech company is aimed at improving its profitability.
The firm had previously shut down six overseas subsidiaries.
In June, the company informed the stock exchange that its wholly-owned subsidiary, PT Zomato Media, Indonesia has initiated the process of liquidation.
Prior to that, the company announced the deregistration closure of its step-down subsidiary Zomato Australia Pty Limited. It has also previously shut down its subsidiaries in South Africa, Canada, Jordan, Singapore and the UK, citing no business activities. It also shut down its Czech venture Lunctime.
Zomato has shut its services in 225 cities pan India citing poor performance.
Zomato had reported its first ever profitable quarter. The company’s net profit stood at `2 crore in the first quarter ended June 2023 as against a loss of `186 crore in the corresponding quarter a year ago.
The company’s operating revenue also witnessed substantial growth, rising by 71% to reach `2,416 crore from the previous year’s Q1 figure of `1,414 crore.
The company also is charging a platform fee of `2, a move aimed at improving its profitability. Zomato said that the “small fee” has been introduced “to help us pay the bills”.
The company said it had registered a 11% quarter on quarter growth on food delivery gross order value. Zomato charges restaurants a commission of 20-25% on food orders. The fee is expected to improve its customer delivery take rate. A percentage of gross order value is a take rate.