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Tiger Global, CPPIB, and others put money into Zomato’s $562 million anchor allocation ahead of the company’s IPO.
Photo courtesy of Zomato
Ramarathinam, Ashwin
14th of July, 2021
Zomato, an online meal delivery company, announced on Tuesday that it has received Rs 4,196 crore in an anchor book allocation from numerous major institutional investors, a day before its initial public offering.
The company informed exchanges that it has allotted 552.17 million equity shares to anchor investors at a price of Rs76 per share, which is the top end of the company’s pricing band of Rs72-76 per share. On 14 July, public market investors can subscribe to the Rs9,375 crore Zomato IPO, which will close on 16 July.
Government of Singapore, Canadian pension funds Canada Pension Plan Investment Board and OMERS, BlackRock Global Funds, T Rowe Price, Fidelity, Aberdeen Global Indian Equity, Baillie Gifford, Steadview Capital, Goldman Sachs, Neuberger Berman, Abu Dhabi Investment Authority, and Pinebridge Global Funds were among the marquee global investors who participated in the anchor book.
Axis MF, HDFC Trustee, SBI MF, Aditya Birla Sun Life, ICICI Prudential, Kotak MF, Nippon Life India, and SBI Life Insurance were among the domestic investors who invested through the anchor book.
On the condition of anonymity, a source close to Zomato’s share offering claimed, “There was as much as 40x demand for the anchor book.”
The IPO consists of a 9,000 crore fresh offering of equity shares and a 375 crore offer for sale (OFS) by existing investor Info Edge (India), the parent company of Naukri.com.
According to Zomato’s red herring prospectus, the proceeds from the new offering will be utilized to fund organic and inorganic growth plans as well as general business reasons.
According to Mint, the country’s largest meal delivery platform will have a post-money valuation of 59,623 crore at 76 per share, the higher end of the IPO’s price band, putting it in 78th place among listed companies in India by market value. The subscription period for the share sale will begin on July 14th.
Long-established and well-known names such as Hero MotoCorp Ltd, India’s largest two-wheeler manufacturer; pharmaceutical Aurobindo Pharma; Piramal Enterprises; Apollo Hospitals, Biocon Ltd, and Bandhan Bank will be valued higher than Zomato.
Zomato will have nearly $2 billion in cash in the bank following the IPO, or roughly Rs 15,000 crore.
According to Zomato’s prospectus, 6.8 million customers ordered food on the platform every month in FY21, with an average monthly frequency of around three times. In March 2021, Zomato has 169,802 delivery partners and 148,384 eateries on its platform. As of March 31, it had 1.5 million Pro Members and 25,443 Pro Restaurant Partners.
Book-running lead managers include Kotak Mahindra Bank, Morgan Stanley India, Credit Suisse Securities, BofA Securities, and Citigroup Global Markets.
This article initially appeared on livemint.com.
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