Zomato on Wednesday announced a trio of investments: in savings app provider magicpin, logistic aggregator Shiprocket and Curefit. The online food delivery platform said it would invest a cumulative sum of Rs 928.52 crore in magicpin and Shiprocket.
The Deepinder Goyal-led company is also picking up a 6.4 per cent stake in Curefit Healthcare Pvt Ltd for $100 million in cash. Curefit was founded by Mukesh Bansal who had established Myntra. Simultaneously, Zomato is also divesting a stake in its subsidiary Fitso, which will be bought by Curefit.
Zomato is splashing out funds even though its losses have widened to Rs 429.6 crore for the quarter ended September 30 compared with a loss of Rs 356.2 crore in the preceding three months and Rs 229.6 crore in the corresponding quarter of the previous year. Total income of the company rose to Rs 11,610 crore from Rs 9,166 crore on a sequential basis and Rs 4,469 crore a year ago.
“The paradigm for India has changed within a year and that gives us a new opportunity to build a much bigger Zomato than what we dreamt of a year ago,’’ the company said.
Zomato will adopt a three-tier strategy that includes brutal prioritisation, investing in the core business and the ecosystem around it and building a hyperlocal e-commerce ecosystem through partnerships to tap into opportunities beyond food.
The company, which currently has a market capitalisation of Rs 1.06 lakh crore, pointed out that it will divest or shut down any businesses which is unlikely to drive exponential value for its shareholders in the long-term.
Smart moves
As part of this strategy, Zomato has signed an agreement to invest $75 million in Shiprocket owner Bigfoot Retail Solutions Pvt Ltd. This is part of a larger $185 million funding round. Shiprocket is a B2B logistics-tech company.
It is also investing approximately $50 million in magicpin owner Samast Technologies for a 16 per cent stake as part of a total funding round size of $60 million. magicpin drives omni-channel growth for local retailers. It has a network of 170,000 paying merchants in categories such as fashion, food, electronics and grocery.
