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Bet on banks, Bharti, IT; wary on Zepto: Sabharwal

Zepto co-founders got ED summons in FEMA case, firm's IPO draft documents say | What we know

Zepto's draft IPO document said that as on the date of the updated Draft Red Herring Prospectus, it has not received any further communication.

ED summoned Zepto founders under FEMA ahead of IPO: Here’s what the updated DRHP reveals

Quick commerce platform Zepto revealed in its updated draft red herring prospectus (DRHP) on Monday that the Enforcement Directorate (ED) had summoned its founders Aadit Palicha and Kaivalya Vohra in relation to the Foreign Exchange Management Act (FEMA) in April 2026.In its updated DRHP filed with SEBI for a $1 billion (Rs 9,500 crore) initial public offering, Zepto said that Palicha and Vohra were required to produce some documents with regard to foreign investments, audited balance sheets for the financial year 2020-21, shareholding patterns, details on loans and guarantees, income tax returns and bank accounts, along with other information.Complying with the summons, Vohra appeared before the ED on April 17 and April 22. Palicha appeared before the authority on April 20 and May 15 this year. "As on the date of this Updated Draft Red Herring Prospectus – I, they have provided relevant information and documents as requested by ED pursuant to the Summons, as well as follow-on information requested by the ED further to their interactions, including certain details in relation to our holding structure, the Scheme, and additional information in relation to our business such as business agreements and invoices," Zepto said.The quick commerce company said it has not yet received any further communication from ED. It assured that there will not be future inquiries or that these could escalate to investigations, legal proceedings or any possible penalties.Zepto IPOThe much-awaited IPO of Zepto will comprise a fresh issue of shares worth Rs 8,010 crore and an offer-for-sale (OFS) of nearly 11.35 crore shares by existing shareholders, according to the updated prospectus. The five-year-old company had filed its IPO papers confidentially with market regulator SEBI back in December 2025 and received the regulator's approval in May this year.Zepto is aiming to debut on stock markets in July, people familiar with the matter told The Economic Times. This would make the firm the third quick commerce player on Dalal Street, along with Blinkit parent Eternal and Instamart parent Swiggy.Also Read | Zepto files updated papers for Rs 9,500 crore IPO; aims July listingZepto earnings snapshotZepto reported a 75% year-on-year (YoY) jump in consolidated revenue for the fourth quarter of FY26 to Rs 7,498 crore, according to its updated DRHP. The Bengaluru-based company also narrowed its net loss to Rs 1,539 crore during the January-March quarter from Rs 1,832 crore a year earlier, the filing showed.Zepto processed 210 million orders during the quarter, i.e. over 2 million orders a day. It ended March 2026 with 1,139 dark stores, up from 1,029 a year earlier. Orders per store per day rose to 2,140 from 1,425 in the year-ago period, indicating higher throughput across its network.Also Read | Zepto Q4 revenue up 75% at Rs 7,498 crore, narrows loss to Rs 1,538 crore(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

Zepto's Rs 8,010 Crore IPO: Revenue, Losses Up, What Investors Must Know

In the March quarter, Zepto's revenue surged 75.26 per cent to Rs 7,497.64 crore.

Zepto files updated DRHP for $1 billion IPO

Quick commerce company Zepto on Monday filed its updated draft red herring prospectus (DRHP) with the Securities and Exchange Board of India for a $1 billion (Rs 9,500 crore) initial public offering, moving closer to one of the most anticipated new-age listings of the year.The IPO will comprise a fresh issue of shares worth Rs 8,010 crore and an offer-for-sale (OFS) of 113 million shares by existing shareholders, according to the updated prospectus. The five-year-old company had filed its IPO papers confidentially with Sebi in December 2025 and received the regulator's approval in May.According to people aware of the matter, Zepto is targeting a July listing. That would make it the third quick commerce player in the public market, alongside Blinkit parent Eternal and Instamart parent Swiggy. The IPO will also make Zepto the first standalone quick commerce company to list on Indian stock exchanges.Through the OFS component, early investor Nexus Venture Partners, US-based Contrary Capital and Kaiser Permanente, as well as Dubai-based Razor Capital, plan to sell shares in the company.Zepto was last valued at $7 billion in October 2025, when it raised $450 million from investors including CalPERS, General Catalyst, Goodwater Capital and Lightspeed.The company plans to use proceeds from the fresh issue to expand its dark store network across existing and new geographies, as well as fund lease rentals for existing facilities. As of March 31, Zepto operated 1,139 dark stores. It also intends to invest in technology and cloud infrastructure, besides funding marketing and business promotion expenses.For the January-March quarter, Zepto reported operating revenue of Rs 7,498 crore, up 75% year-on-year. Net loss narrowed to Rs 1,539 crore from Rs 1,832 crore a year earlier.During the fourth quarter, Zepto processed 210 million orders on its platform, compared with 274 million for Blinkit and 113 million for Swiggy's Instamart.Besides Blinkit and Instamart, Zepto competes with Tata-owned BigBasket, Flipkart Minutes and Amazon Now in India's 10-minute delivery market.The company's founders, Aadit Palicha and Kaivalya Vohra, along with their families and family offices, comprise Zepto's promoter group, which collectively holds a 19.6% stake in the company.Palicha and Vohra, along with US-based investor and Glade Brook Capital founder Paul Hudson, Zepto CFO Ramesh Bafna, Avra founder and former Y Combinator managing director Anu Hariharan, and former Bharti Enterprises chairman Akhil Gupta, comprise Zepto's board of directors. Hudson serves as chairman of the board.Zepto's IPO comes at a time when the quick commerce industry is locked in an intense battle for market share, even as growth at leading platforms has moderated amid a broader push towards profitability. The entry of ecommerce giants Amazon and Flipkart into the 10-minute delivery segment has further intensified competition and sparked a fresh round of price wars.

Zepto shares crash 30% in unlisted market despite Sebi nod for IPO. What's cooking?

The unlisted shares of Zepto Limited have fallen nearly 30% over the past month despite the company securing regulatory approval for its IPO, highlighting growing caution among investors amid volatile market conditions.Zepto's shares, which were changing hands at around Rs 52 in the unlisted market a month ago, have dropped to about Rs 40, according to dealers tracking pre-IPO transactions.The decline comes even as the quick commerce startup recently received approval from Sebi to launch its much-awaited public issue. The company had taken the confidential route to file the DRHP but may soon file its papers publicly in June, according to Bloomberg.Analysts said the fall reflects weakness in the unlisted market and a broader reassessment of valuations rather than any company-specific development. The company is being valued at around Rs 38,000 crore in the dealer market.Several companies that had planned public offerings this year have either delayed listings or adopted a wait-and-watch approach because of volatility in equity markets, geopolitical tensions and uncertainty around investor demand.The benchmark Nifty has remained under pressure for much of 2026, while foreign institutional investors have continued to remain cautious on Indian equities amid concerns over crude oil prices, global growth and the earnings outlook.The weakness in the secondary market for pre-IPO shares has also affected several startup names, with investors becoming more selective on valuations after a strong rally in the segment over the past two years.Zepto is preparing for a public market debut that could raise around $1.3 billion, or roughly Rs 11,000-12,000 crore, making it one of the largest internet IPOs since the listing of Swiggy.If the issue proceeds as planned, Zepto could become the youngest venture-backed Indian startup to enter public markets, just four years after its founding.The proposed offering is expected to comprise a substantial fresh issue of around Rs 11,000 crore along with an offer-for-sale component by existing investors.The IPO assumes significance because it comes amid intensifying competition in India's fast-growing quick commerce sector.Zepto competes with Blinkit, owned by Eternal, as well as Swiggy Instamart, Flipkart Minutes and Amazon Now.The listing is also expected to strengthen the company's balance sheet at a time when the quick commerce industry continues to spend aggressively on expansion, dark stores and customer acquisition.As of late last year, Zepto had around Rs 7,000 crore in cash, significantly lower than the roughly Rs 17,000-18,000 crore cash reserves reported by listed rivals Eternal and Swiggy.The company raised $450 million in October last year at a valuation of $7 billion. Following the fundraise, it accelerated customer acquisition efforts through higher discounts and promotional campaigns as competition intensified across major cities.Zepto had also completed its domicile shift from Singapore to India, a move increasingly adopted by venture-backed startups preparing for domestic listings.The company has appointed a consortium of investment bankers including Morgan Stanley, HSBC, Goldman Sachs, Axis Capital, JM Financial, IIFL Securities and Motilal Oswal Financial Services to manage the public issue. The IPO is expected to hit the market in the July-September quarter of 2026.While the recent decline in the unlisted share price may reflect near-term market caution, investors will closely watch the final valuation and broader market conditions when Zepto eventually launches what is expected to be one of the year's most closely watched public offerings.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)