Shares of food and grocery delivery company Zomato rose 1.83% on Tuesday, reaching an intra-day high of Rs 278 on the NSE, as the company opened its Qualified Institutional Placement (QIP).
The firm has set a floor price of Rs 265.91 per share, with an indicative price of Rs 252.62 per share. The indicative price represents a 7.6% discount to the company’s closing market price of Rs 272.9 on Monday.
A total of 33.65 crore shares, equivalent to 3.8% of the company’s equity, have been put on offer as part of this fundraising initiative.
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Shareholder and Board Approvals for Rs 8,500 Crore Fundraise
This move follows shareholder approval on November 23, 2024, for Zomato’s proposal to raise capital via a QIP. The company’s board had earlier approved plans to raise up to Rs 8,500 crore through the issuance of shares to qualified institutional buyers.
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Zomato has stated that the funds raised will help strengthen its balance sheet, though specific details on the allocation of proceeds remain undisclosed.
Under the regulatory framework of SEBI’s (Issue of Capital and Disclosure Requirements) Regulations, 2018, and the Companies Act, 2013, the company is authorized to offer a discount of up to 5% on the floor price, subject to shareholder approval.
Where Will the Funds Raise Use?
The proceeds from the QIP will be used to fund the company’s business operations and strategic initiatives, enabling Zomato to further solidify its position in the competitive food delivery and grocery market.
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While no detailed breakdown of the fund utilization has been shared, the company’s focus remains on maintaining a robust financial framework to support its long-term goals.
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