Zomato's new delivery route: Why the food delivery major is banking on Blinkit

Deepinder Goyal, 41, is one of those early start-up stars who are followed widely by young Indians wanting to take the entrepreneurship plunge. Goyal’s Zomato—together with arch-rival Swiggy—dominates the country’s food delivery landscape. However, there’s a big difference: Zomato is now a listed company and, more importantly, has been making profits for the past three quarters. Not surprisingly, the Zomato stock (the company was listed in July 2021) has been on a strong upward trajectory as investors begin understanding the strategy that Goyal and his top management have been rolling out over the past year or so. Central to the new Zomato growth menu is Blinkit (formerly Grofers), the quick commerce company Goyal bought for a substantial Rs 4,447 crore in June 2022. That was a big bet at a time when the Zomato stock was floundering, and the investors had to be convinced the deal was worth going for despite the steep asking price. But Goyal went with his instinct and picked up Blinkit, which today is one of the key reasons why it is racing towards what could be its first full year of profits.

Going forward, Blinkit is expected to drive revenues owing to the scope of growth in quick commerce and its scale of operations. Alongside the quick commerce push, Zomato is also rewiring its core food delivery offering: it relaunched its subscription product, Zomato Gold, in January 2023, giving customers the ease of free delivery and better return on investment. In our cover story, the usually reticent Goyal explains his new strategy in detail to Krishna Gopalan and even makes it clear that “Blinkit will be larger than Zomato in one-tenth the time”. That’s some confidence in quick commerce. Besides, Hyperpure, its business-to-business farm-to-table model, is also aimed at supplementing the growth agenda. Eventually, as Goyal sees it, Zomato will have a healthy mix of B2B and B2C businesses. Zomato’s recent profitable run is significant given that rival Swiggy is also planning a public listing, though it was in the red in FY23 (as was Zomato then). How the next several months play out for Goyal’s Rs 1.3 lakh crore market-cap company will be riveting to watch.

Talking of markets, Ashish Rukhaiyar and Rahul Oberoi bring you a special report on mutual funds (MFs) as the assets under management of MFs cross `50 lakh crore for the first time. While the segment has had a good run, there’s work to be done in terms of increasing the penetration of MFs into Tier II and III cities and beyond. Surabhi also brings you a detailed analysis of the recently announced Interim Budget, where Finance Minister Nirmala Sitharaman thankfully steered clear of populist measures and continued on the road to fiscal consolidation.