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Indian food delivery firm Zomato’s loss narrows on one-time gain

A delivery worker of Zomato, an Indian food-delivery startup, prepares to leave to pick up an order from a restaurant in Mumbai, India, July 13, 2021. REUTERS/Francis Mascarenhas

BENGALURU, Feb 10 – Indian food delivery firm Zomato Ltd (ZOMT.NS) reported a smaller third-quarter loss on Thursday, helped by a one-time gain from a stake sale, while revenue jumped due to increased demand for restaurant meals.

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Zomato’s dining out business, which offers customers discounts and offers when they eat out at partner restaurants, strengthened as eateries and bars reopened following a drop in COVID-19 cases during the quarter, while the company’s core food delivery business continued to grow.

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“The revival of in-restaurant dining (in the third quarter) led to some green shoots in our dining-out ad-sales business,” the Gurugram-based firm said in a regulatory filing.

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Zomato also said it would increase the upper limit of its potential investments over the next two years in the quick commerce market to $400 million.

India’s quick commerce and hyperlocal delivery space has attracted investors over the past year, with both Google (GOOGL.O) and Reliance Industries (RELI.NS) investing in Bengaluru-based startup Dunzo. read more

Zomato also invested about $225 million in the past year in delivery firm Blinkit, logistics-tech firm Shiprocket and neighbourhood business discovery app Magicpin.

Gross order value, or the total monetary value of all food delivery orders placed on Zomato’s online platform, rose 84.5% year-over-year to 55 billion rupees ($733.07 million), while orders jumped 93%.

The company’s consolidated net loss narrowed to 632 million rupees for the three months ended Dec. 31, from 3.53 billion rupees a year earlier, helped by a one-time gain of 3.16 billion rupees from the sale of its stake in Fitso, an online platform that helps people discover sporting venues.

Revenue from operations rose 82.5% to 11.12 billion rupees.

Zomato shares have lost 25% since listing in July last year amid weakness in the broader market on valuation concerns and expectations for monetary policy tightening by global central banks.

($1 = 75.0270 Indian rupees)

Reporting by Anuron Kumar Mitra in Bengaluru; Editing by Sriraj Kalluvila and Vinay Dwivedi

Our Standards: The Thomson Reuters Trust Principles.

REUTERS

FEB 10, 2022

https://www.reuters.com/markets/funds/indian-food-delivery-firm-zomatos-quarterly-loss-narrows-2022-02-10/

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