Zomato IPO fully covered as Tiger Global, GIC, other anchors invest $562 mn

 Zomato IPO fully covered as Tiger Global, GIC, other anchors invest $562 mn

Indian food delivery company Zomato Ltd’s initial public offering sailed through on the first day of the issue Wednesday even as it raised Rs 4,196.52 crore ($562 million) from a large number of anchor investors.

Zomato, the first unicorn startup to float an IPO in India, received bids for more than 756.43 million shares for the 719.23 million shares on offer, stock-exchange data show.

The portion set aside for retail investors was covered 2.7 times while the quota reserved for institutional buyers was almost fully covered.

At the time the issue closed for subscription on Friday, Zomato saw overall bids worth 38x the shares it had offered led by over 51 times bid by institutional investors. Corporates and HNIs bid for almost 33x the portion reserved for them while retail investors applied for over 7 times their allocation.

Ahead of the IPO, the company allotted a tad more than 552 million shares at Rs 76 apiece to around 130 anchor investors, including many of its existing private equity and venture capital backers.

Tiger Global, the New York-based venture investor and hedge fund, invested about Rs 162.45 crore. Canada Pension Plan Investment Board, Singapore sovereign wealth fund GIC and existing investor Baillie Gifford put in Rs 125 crore each.

Kora Management, Steadview Capital, Canadian pension fund OMERS and Norwegian sovereign fund Government Pension Fund Global bought shares worth Rs 55.15 crore each.

Abu Dhabi Investment Authority and funds managed by BlackRock, Fidelity, Goldman Sachs, T Rowe Price and JP Morgan were among the other foreign anchor investors.

Several Indian asset management companies, including SBI Mutual Fund, Axis Mutual Fund, Aditya Birla Sun Life Mutual Fund, Kotak Mutual Fund, Nippon India Mutual Fund and Mirae Asset Mutual Fund, also joined Zomato’s cap table.

Gurugram-based Zomato is the first online food ordering venture in India to go public. It is chasing a valuation of as much as $8 billion in the IPO that now aims to raise a higher amount than it previously planned. Zomato was valued at $5.4 billion in February when it raised $250 million from five investors in a round led by Kora Management.

The company has announced a price band of Rs 72-76 per share in one of the most anticipated IPOs by an Indian company. The IPO begins today and closes Friday.

Its IPO comprises a fresh issue and a secondary sale by early investor Info Edge (India) Ltd worth Rs 375 crore. At the upper end of the price band, Zomato will issue 1.18 billion shares to raise Rs 9,000 crore ($1.2 billion) in fresh capital and will be valued around Rs 59,623 crore (or $7.98 billion).

The company had filed for an IPO in April to raise as much as Rs 8,250 crore ($1.1 billion).  The IPO plan initially comprised a fresh issue of shares worth Rs 7,500 crore and a sale of shares worth Rs 750 crore by Info Edge, the company behind jobs portal Naukri.com and property classifieds website 99acres.com. However, Info Edge subsequently cut its offer for sale while Zomato increased the size of the fresh offering.

Zomato counts New York-based Tiger Global, Singapore state investment firm Temasek, Fidelity, Sequoia Capital, Kora Management and D1 Capital among its 74 external shareholders. These investors aren’t selling any shares.

*The headline and text of this article have been updated to include Zomato’s IPO subscription details.

Sumit Upadhyaya

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