home Uncategorized Blinkit’s Losses Are Coming Down Every Month: Zomato CFO Akshant Goyal Laxitha Mundhra

Blinkit’s Losses Are Coming Down Every Month: Zomato CFO Akshant Goyal Laxitha Mundhra

Zomato’s acquisition of quick commerce startup Blinkit has been the talk of the town, even impacting the former’s share price on the stock exchanges. Primary concerns revolved around profitability issues, as both Zomato and Blinkit (formerly Grofers) are experiencing heavy losses.

Addressing the concerns during the shareholders’ meet, Zomato’s CFO Akshant Goyal, stated that Blinkit’s losses are coming down every month. From INR 204 Cr in January 2022, the estimated July loss will be INR 92.9 Cr.

He added that the losses were coming down due to operating leverage and improved execution. “As the GOV (gross order value) per day per store goes up, losses come down given the high operating leverage in the business.”

Further, Zomato expects Blinkit’s order numbers to rise to 83 Lakhs by July 2022-end from 79 Lakhs in May 2022 and 51 Lakhs in January 2022. It estimates the monthly transacting customers base to rise to 25 Lakhs by July end from 2.3 Lakhs in May and 1.5 Lakhs in January 2022.

January 2022
May 2022
July 2022 (E)

Order Numbers
51 Lakhs
79 Lakhs
83 Lakhs

MTU
15 Lakhs
23 Lakhs
25 Lakhs

Monthly GOV
INR 295.5 Cr
INR 402.8 Cr
INR 482.7 Cr

Revenue
INR 22.1 Cr
INR 58 Cr
INR 74.9 Cr

Loss
INR 204 Cr
INR 107.7 Cr
INR 92.9 Cr

The monthly GOV is expected to increase to INR 482.7 Cr for Blinkit by July-end compared to INR 402.8 Cr in May and INR 295.5 Cr in January. 

“Revenue is projected to jump to INR 74.9 Cr by July 2022-end against INR 58 Cr in May 2022 and INR 22.1 Cr in January. Losses are expected to decline to INR 92.9 Cr by July-end from losses of INR 107.7 Cr in May 2022 and INR 204 Cr in January this year,” Zomato has predicted.

It is noteworthy that despite the month already ended, Blinkit is yet to consolidate its balance sheet. It is also yet to announce its results for the April 2022 – June 2022 quarter.

Deepinder Goyal On Zomato-Blinkit Deal

In a shareholder’s letter, released along with Zomato’s results for Q1 FY23, Goyal addressed certain aspects of the criticism related to the Blinkit acquisition. Starting with the corporate governance issues, Zomato founder Goyal stated that the company ensured ‘rigorous and detailed due diligence, deliberations and negotiations’, before agreeing to the transaction terms.

Another contesting point was that Blinkit founder Albinder Dhindsa and one of Zomato’s cofounders Akriti Chopra were married. Goyal stated that there was nothing to hide about Chopra and Dhindsa’s marriage and that the board was aware of it.

Consequently, all parties, including Akriti herself made sure to be never involved in any discussions or decisions with respect to the transaction. “We also took an independent opinion from Saraf & Partners on there being no related party transaction under applicable law,” Goyal added.

Zomato itself reported a consolidated loss of INR 186 Cr in the Q1 FY23 – a 48% YoY decline from INR 360 Cr in the corresponding quarter of FY22. Its operating revenue also jumped over 67% year-on-year (YoY) to INR 1,413.9 Cr.

Blinkit will further add value to Zomato as quick commerce becomes a go-to mechanism for consumers’ shopping baskets across grocery, fruits and vegetables, beauty and personal care, OTC medicines and stationery items, among others. Zomato is further looking to consolidate all its businesses (delivery and dining, Blinkit’s quick commerce and Hyperpure’s nutraceuticals) under one parent entity – Eternal.

The post Blinkit’s Losses Are Coming Down Every Month: Zomato CFO Akshant Goyal appeared first on Inc42 Media.

Zomato’s acquisition of quick commerce startup Blinkit has been the talk of the town, even impacting the former’s share price… News, B2B-B2CInc42 Media

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