Quick commerce platform is set to file its draft red herring prospectus (DRHP) in the second half of this year
This comes at a time when the company is looking to bring down its cash burn and working on being profitable.
“The company is on track to file its DRHP by the second half of this year,” said sources.
Zepto is also looking to raise capital from its existing international investor and has received term sheets from Avenir Growth to potentially co-lead a $700 million fundraise, sources said. “Other existing investors may also increase their stakes,” one of the sources added.
Interestingly, Zepto had earlier aimed to boost domestic shareholding, but the ongoing international fundraise may limit that ambition. Currently, 43–44% of Zepto is Indian-owned, and the company is optimistic about crossing 50% by IPO time, another source said.
The IPO plan is also being scaled up. Zepto is now looking to raise around $800 million, higher than its earlier target of $400–500 million, and has roped in JM Financial and Motilal Oswal to its syndicate alongside Goldman Sachs, Morgan Stanley and Axis Capital, according to multiple people aware of the developments.
Operationally, Zepto has also hit roadblocks. Its Zepto Cafe paused operations across 44 stores in Delhi NCR, while a Maharashtra FDA notice has disrupted deliveries in Dharavi. Additionally, delivery partner unrest has affected services in Hyderabad.
These moves come amid growing market pressure. Zepto which competes with Swiggy’s Instamart, Eternal’s Blinkit, Flipkart, BigBasket and others, is believed to have missed revenue and cost targets in Q4FY25, prompting a strategic recalibration.
Even as Swiggy’s valuation has dropped from a peak of $18 billion to around $10 billion, market watchers say Zepto’s fortunes remain linked to its larger rivals. “The better Swiggy and Eternal perform, the better the valuation that Zepto gets – as simple as that,” sources added.