Zepto CEO hopes for IPO in 2025; he says claims of fast trading hurting Kiranas are not supported by data

Fresh off USD 350 million in funding this time from local marquee investors, fast-paced e-commerce company Zepto says it is on a clear path to becoming a fully Indian-owned business and reaching the PAT milestone, as founder and CEO Aadit Palicha expresses optimism. about a possible IPO in 2025.

In an interview with PTI, Palicha strongly refuted allegations about the fast-paced business model disrupting and hampering the growth of traditional kirana shops. He stressed that these and other “news” are not based on real data and undermine the “total benefits” the industry has achieved so far, including job creation.

Palicha went on to say that 10-minute fast delivery models like Zepto’s have generated lakhs of jobs, are additive-additive, and create “value” all around for consumers and workers.

In addition, the rapid commercial model used on the scale of grocery and daily necessities is not seen and matched in the rest of the world, he said and this will show the unique strength of Indian technology.

Armed with data and numbers, Palicha refuted the allegations made by a group of retail distributors including the prices, saying that 99.8 percent of the products sold on the platform were above cost.

“Therefore, the allegations of criminal charges like other ‘narratives without data’ that have been created about the fast trade in the past few years, in fact do not add up and we are happy to have anyone who does not believe come to our office. We also look at our books because they are the truth of statistics,” he said.

On important issues such as food quality safety, he admitted there were concerns about how the industry could make processes easier for consumers. Palicha said the industry welcomes the scrutiny, adding that the company’s interests are aligned with customers.

“So let’s not quarrel with FSSAI…We consider them as partners who can help us serve our customers better,” he said.

Citing other estimates, Palicha said India is poised to see more than USD 200 billion in additional consumption.

“It is economically impossible for a kirana store to shrink… We are growing but kirana stores are also growing, as are other types of commerce,” he said.

According to him, the allegations about the prices “do not add up” either.

“The reason why stories like this are so dangerous is because they hide all the good things we have done for the country,” he said.

The bottom line is that the fast-moving commercial sector in three years has created 4.5 lakh jobs, he said and added that the average salary of over Rs 20,000 is also “much higher” than jobs in the informal sector.

“…Most importantly, this is Indian technology, real infrastructure. I think it’s a great thing, and we should celebrate the new Indian technology. There is no other place in the world on a scale where you can click a button on your phone and get your daily essentials like shampoos and rice. delivered in 10 minutes,” he said.

The round included investments from Indian HNIs, family offices, and leading financial institutions. The fundraising was exclusively led by Motilal Oswal’s Private Wealth.

Palicha said the purpose of the round was to raise domestic ownership on the way to an IPO sometime in the 2025 calendar year.

“That is our desire… Yes, the financial markets can change, but at the moment we are very optimistic if the business continues to do well, we will go public with the 2025 calendar,” he said.

Regarding the status of the company’s plans to relocate to India from Singapore, Palicha said the company is moving fast on that and all the boxes are checked or close to being checked.
“We are willing to commit that within the next financial year, sometime in FY26 we will be a fully Indian owned company… That is our desire and our aim, and it looks like we will get there. So what I can tell you is that we will be a domestic company within the next financial year” he said. he.

With the business growing rapidly, Zepto is looking to expand to more than 50 cities in the next quarter, taking its footprint above and beyond the current twenty-two cities.

“In April-May 2024 we hit a billion dollars in the top line. We’ve already expanded on that base, and we expect to keep multiplying. Soon (we’ll make) another big step in hitting another big top line milestone. …We’re growing fast and multiplying at the rate of billions of dollars in the top line , which is one of the fastest growing consumer companies in the country right now,” he said.

According to Palicha, most of the stores are profitable, and within a short period of 23 months the profit times have decreased to 8 months.

“In the next financial year, we will be hoping for PAT. We are confident and hopefully that will be a good sign for the markets,” he said.

Palicha said the company is seeing “tremendous results” from Zepto Cafe, which adds margin and increases customer loyalty and retention of the core business.

“We will reach Rs 1,000 crore business in Zepto Cafe alone…Customers love it. It gives us more frequency and retention in core business…People open the app more times,” he said.

On competition from rivals such as Blinkit and Swiggy Instamart, he said competition is “a good thing” and pointed out that the market is “really big”.

“There is a lot of room for everyone, so we feel good about it, in short, and we just focus on what we do… We don’t think too much about the competition, and we think the market is big enough,” he said.