{"id":133150,"date":"2021-07-23T14:52:34","date_gmt":"2021-07-23T14:52:34","guid":{"rendered":"https:\/\/precoinnews.com\/?p=133150"},"modified":"2021-07-23T14:52:34","modified_gmt":"2021-07-23T14:52:34","slug":"shares-in-indian-food-startup-zomato-jump-80-on-ipo","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/business\/shares-in-indian-food-startup-zomato-jump-80-on-ipo\/","title":{"rendered":"Shares in Indian food startup Zomato jump 80% on IPO"},"content":{"rendered":"
Startups are attracting billions of dollars in investment even though they are yet to make a profit<\/p>\n
Shares of Indian food delivery giant Zomato soared on its market debut on Friday, after a 93.75 billion rupee (\u00a3916.6m) IPO, the country\u2019s biggest this year.<\/p>\n
Approximately 30 Indian companies have announced plans to list shares this year, with startups attracting billions of dollars in investment even though many are yet to make a profit.<\/p>\n<\/p>\n
Zomato, which counts subsidiaries of Chinese tycoon Jack Ma\u2019s Ant Group and Uber among its shareholders, dominates India\u2019s booming app-based food delivery space alongside rival Swiggy.<\/p>\n
Its shares debuted at 115 rupees on the BSE\u2019s Sensex Index, 51% higher than its issue price after its IPO was subscribed 40.38 times at the end of last week.<\/p>\n
The stock then rocketed up 80% in the opening 10 minutes, taking Zomato\u2019s market capitalisation above the 1 trillion rupee mark.<\/p>\n
India\u2019s economy has taken a battering during the pandemic, recording its worst annual recession since independence in 1947. But its start-up sector has been a rare bright spot.<\/p>\n
This year alone, about 20 \u201cunicorns\u201d \u2013 firms valued at more than $1bn \u2013 have been created, including half a dozen in four days in April.<\/p>\n
Many are struggling to recruit qualified employees, with some reportedly offering incentives such as free motorbikes and tickets to cricket matches to lure talent.<\/p>\n
This year is set to be India\u2019s best for IPOs. Others set to list include digital payments firm Paytm, backed by Japan\u2019s SoftBank and Ma.<\/p>\n
Many of the startups, though, are loss-making.<\/p>\n
Zomato, for instance, which operates in 525 Indian cities, is yet to turn profitable and reported a loss of 8.16bn rupees in the financial year ending March 2021.<\/p>\n
\u201cWe are going to relentlessly focus on 10 years out and beyond, and are not going to alter our course for short-term profits at the cost of long-term success of the company,\u201d Zomato\u2019s chief executive, Deepinder Goyal, said on Friday.<\/p>\n