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Zomato, the online food delivery platform, has showcased a remarkable turnaround in its financial performance for the December quarter, posting a consolidated net profit of ₹138 crore. This stands in stark contrast to the net loss of ₹347 crore reported in the same quarter of the previous fiscal year.
In its Q3 results for fiscal 2023-24 (Q2FY24), Zomato recorded a robust revenue from operations amounting to ₹3,288 crore, marking a substantial growth of 69 per cent compared to ₹1,948 crore in the corresponding period last year.
The company attributed its improved financial outlook to heightened demand during the men's Cricket World Cup, held from October 5 to November 19, 2023 and the festive season, which typically sees a surge in orders and contributes significantly to Zomato's annual sales.
Despite facing higher total expenses amounting to ₹3,383 crore, compared to ₹2,485 crore in the same period last year, Zomato managed to maintain a profitable trajectory. Revenue from its core food delivery business witnessed a commendable 48 per cent growth during the quarter, while revenue from its quick commerce division more than doubled, further bolstering its overall performance.
Zomato operates multiple units, including a food marketplace platform connecting end users, restaurants, and delivery personnel. Hyperpure supplies farm-to-fork goods to restaurants and businesses, while Blinkit offers kirana, FMCG, and other essentials within a speedy 10-minute delivery window.
Moreover, Zomato offers services such as dining.out and Zomato Live, enabling users to explore restaurants, reserve tables, and book tickets for entertainment events.
In Q3 FY24, Zomato generated 51.8% of its total operating revenue through its food ordering and delivery business, which saw a 10.2% growth to Rs 1,704 crore from Rs 1,546 crore in Q2 of the same financial year. Hyperpure supplies (B2B business) contributed Rs 859 crore, marking a 15.3% increase, while the quick commerce vertical (Blinkit) added Rs 644 crore to the group's revenue. The remaining income was derived from the 'Going-out' segment and other operating activities during the quarter ending December 2023.
Additionally, Zomato earned Rs 219 crore as non-operating income (primarily from interest and gains on financial assets) in Q3 FY24, pushing its overall revenue beyond Rs 3,500 crore during the period.
Regarding expenses, delivery and related charges represented 31.6% in Q3, rising 16.2% to Rs 1,068 crore. The purchase of stock increased by 16% to Rs 782 crore, while employee benefits costs remained stable at Rs 423 crore during the quarter.
Zomato also allocated Rs 374 crore to advertisement and promotions, contributing to a total expenditure rise of 11.3% to Rs 3,383 crore in Q3 FY24.
Reflecting its growing scale, Zomato's profits surged 3.8 times to Rs 138 crore in Q3, compared to Rs 36 crore in the previous quarter. In the same quarter of FY23, it had incurred losses amounting to Rs 347 crore.
On a unit level, the company spent Rs 1.03 to earn a rupee in Q3 of FY24.
For the nine-month period ending in December 2024, Zomato recorded revenue from operations amounting to Rs 8,552 crore, with a profit of Rs 176 crore.
Having made its public market debut in July 2021 at a valuation of $12 billion, Zomato witnessed fluctuations in its share price, reaching a peak of over Rs 150 per share in November 2021, before declining to under Rs 50 by July 2022.
Zomato regained momentum in Q1 of FY24 when it achieved profits for the first time. Since then, the company has seen nearly a threefold increase in its share price, with its current share price hovering around Rs 144 per share.
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