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Food delivery major Zomato’s net loss narrowed to ₹250.8 crore in the quarter ended September 30, 2022, compared to ₹434.9 crore reported in the same quarter last year.
The company’s revenue from operations jumped 62.2 per cent to ₹1,661 crore in Q2 compared to ₹1,024 crore in Q2 last year. Acquisition of Blinkit (quick commerce) closed on August 10, 2022. Hence, this quarter results includes about 50 days of Blinkit financials consolidated into Zomato’s overall financials.
“Total Adjusted Revenue grew 48 per cent year-on-year to ₹2,107 crore (38 per cent year-on-year ex-quick commerce). This translates to annualised revenue of $1.05 billion. This is the first quarter where we have crossed the billion dollar annualised revenue mark,” the company said in a BSE filing.
EBITDA loss
Zomato said its total adjusted EBITDA loss reduced to ₹192 crore in Q2 (₹310 crore). Adjusted EBITDA loss (ex-quick commerce) was at ₹60 crore for the quarter (compared to ₹150 crore in Q1FY23).
“In Q2FY23, 248 cities out of Zomato’s 1,000+ cities were contribution positive. These cities contributed almost 91 per cent of the company’s overall GOV (Gross Order Value ) in Q2FY23. Over the medium term, our ambition lies in getting food delivery Adjusted EBITDA to ~4-5 per cent of our GOV. Based on our current growth projections, that could happen with contribution margin as a percentage of GOV of ~8 per cent,” said Akshant Goyal, Zomato CFO.
In food delivery, Zomato’s average monthly transacting customers grew 4.4 per cent QoQ to 17.5 million in Q2FY23 compared to 16.7 million in Q1FY23. Further, Blinkit’s Gross Order Value grew 26 per cent quarter-on-quarter to ₹1,482 crore while the revenue grew 44 per cent.
Adjusted EBITDA loss in quick commerce reduced to ₹259 crore from ₹326 crore in Q1FY23 leading to adjusted EBITDA (as a percentage of GOV) of -17.5 per cent in Q2FY23 as compared to -27.8 per cent in Q1FY23.
Room for growth
Commenting on the impact of macro-economic outlook and globally inflation on Zomato’s business, Deepinder Goyal, CEO Zomato, said, “While our food delivery business has been growing and steadily moving towards profitability, I believe there is room for the business to grow much faster than what it is currently trending at. I don’t know if I can attribute this to the macro environment — primarily because I know for a fact that we could have innovated and executed better in the last couple of months.”
He added that the restaurant and food delivery industry in India is still nascent and needs relentlessly execution to tap into the large opportunity. As far as quick commerce is concerned, Goyal said the company has not seen any/much slowdown in the business.
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