Mon Jan 20 22:12:18 IST 2025: ## Zomato Shares Dip Despite Revenue Surge Amidst Aggressive Expansion

**Mumbai, India** – Zomato’s shares experienced a significant drop on Monday, falling 3.14% to close at Rs 240.95, following the release of its Q3 FY25 financial results. While the company reported a substantial 64.39% year-on-year (YoY) surge in revenue to Rs 5,405 crore, a 57.24% YoY decline in net profit to Rs 59 crore overshadowed the positive news.

The stock initially plummeted over 7% before recovering slightly. The decline comes despite a 128% YoY growth in adjusted EBITDA. However, this was offset by a 14% quarter-on-quarter (QoQ) fall attributed to increased investment in new store openings and customer acquisition within its quick commerce business, Blinkit.

Zomato’s aggressive expansion strategy is evident in Blinkit surpassing its 1,000-store target a quarter ahead of schedule, with plans to reach 2,000 stores by December 2025 – a year earlier than previously projected. However, this rapid growth has come at a cost. The company noted muted growth in its food delivery segment, with a 2% QoQ increase (17% YoY).

CEO Deepinder Goyal attributed the losses in the quick commerce business to accelerated investments, stating they were pulled forward from future quarters. CFO Akshant Goyal acknowledged that near-term losses are expected to continue due to ongoing expansion, potentially impacting profits for the next one to two quarters. He expressed confidence that this investment will lead to significantly higher growth (above 100%) in FY25 and FY26 and ultimately result in substantial profitability once the expansion phase concludes.

Read More