Constant Losses, Still Zomato Doubles its Revenue

Popular online restaurant discovery and food ordering service Zomato’s losses increased 3 fold in fiscal 2016, still manages to double its revenues.

According to the disclosures made by Info Edge, an Internet holding company that is also the 50% stakeholders of Zomato, the latter recorded revenue of Rs 185 crore at the ending of March 2016 despite of losses more than 3 times to Rs 440.96 crore. In the financial year of 2014-2015, the company clocked revenue of 96.7 crore and loss prior to taxes, interest, reduction and amortization of Rs 136 Crore.

In January, ET revealed that Zomato was expecting to fall even operationally in June 2016. However, in February 2016, Zomato declared that it had gained the operational break-even in 6 counties including India.

Recently, HSBC Securities and Capital Market, HSBC’s Brokerage arm slashed the online value of this online restaurant discovery and food ordering service provider to half $500 million. It also showed concerns about the dependability of Zomato on advertisement as a revenue earner, and growing competition in the International market of food ordering segment.

However, earlier this month, Deepinder Goyal, CEO of Zomato claimed that “they are profitable in the order business at an economic level, and the overall online ordering business will hit profitably when they hit average 40,000 orders a day”. He also noted that they are generating 33,000 online orders every day as of May 8 and this is why they claimed to be the “largest online profitable players on a unit economic level by GMV.

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Joe David

Joe David grew up in a business family and done his MBA in Marketing and Finance. After working with educational institute for more than 5 years he chooses to write on various educational stuffs on Easy Management Notes. Also, he provides mentorship to MBA Students.

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