ZOMATO Q1 RESULTS 2024: COMPANY TURNS PROFITABLE

Zomato reported its Q1FY24 numbers on Thursday after market hours. Earlier, the share price closed 1.% higher at Rs 86.45 per share. Let us look at everything in detail about Zomato's Q1 results. 

About Zomato

Zomato is an online food delivery and restaurant discovery platform, headquartered in India. It allows users to explore nearby eateries, view menus, and place orders for delivery or takeout. Zomato operates in various countries, connecting millions of diners with diverse culinary experiences.

Crucial parameters

• PE: 632.76
• 52-week high: Rs 88.46
• Market Cap: Rs 73,969.75 crore
• ROE: 0.56

Share price movement

In the last month, Zomato's shares have beaten NIFTY50 gains and jumped 15.57%. In 2023, the stock had an exceptional rally of 43.37%. Since its listing in July 2021, the Zomato stock price is still down 31.39%.

How has Zomato performed in Q1FY24?

Let us look at Zomato's Q1 numbers in detail:

Revenue: The company reported a consolidated adjusted revenue of Rs 2,786 crore, up 54% YoY as demand growth recovered on cooling inflation and the strength of the food delivery platform’s loyalty program.

EBITDA: The company reported adjusted EBITDA of Rs 12 crore. In the year-ago period, Zomato reported an adjusted EBITDA of Rs (150) crore. The adjusted EBITDA margins were 0.4%, up by 9 basis points.

Profits: Zomato posted its first-ever profitable quarter. The profits stood at Rs 2 crore. In the June quarter of last year, the company reported a loss of Rs 186 crore. The company had earlier said to become profitable sometime in FY24. However, it was able to achieve it in the first quarter as some critical parts of the team across their businesses out-executed their expectations/plans, and some of their initiatives delivered better outcomes than the company had expected. 

The company has said that it will remain profitable going forward and believes that it will continue to deliver 40% YoY topline growth for at least the next couple of years.

Orders: In Q1FY24, the company had 36.8 million orders, lower than the March quarter's total order count of 39.2 million but much higher than Q1FY23's 22.2 million orders. The average order value has increased from Rs 528 in Q1FY23 and Rs 522 in Q4FY23 to Rs 582 in Q4FY24. Average monthly transacting customers have increased to 3.9 million, from 2.2 million in the year ago-period. 

Dark Stores: Dark stores count has decreased to 383 in the first quarter of the current financial year, compared to 409 in the year-ago period. In Q4FY23, the company had 377 dark stores.

GOV: Gross Order Value (GOV) refers to the total monetary value of all orders placed on a food delivery platform during a specific period before any deductions or adjustments are made. It includes the sum of the prices of all the items ordered, any applicable taxes, delivery fees, and other charges.

GOV increased by 11% sequentially. For Q1FY24, it was Rs 2140 crore compared to Rs 2046 crore reported in the March quarter. GOV growth was driven by robust growth in order numbers and a modest uptick in average order value. 

Cash balance: The cash balance on a consolidated basis as of the end of 30th June 2023 was Rs 11,573 crore as compared to Rs 11,323 crore as of the end of 31st March 2023.

Segment Updates

Blinkit Updates: Blinkit reported muted topline. The slower sequential GOV growth in Q1FY24 was due to the temporary business disruption in April resulting from the change in the delivery partner payout structure. Due to this, some of the dark stores for a few days, which caused a decline in overall order volumes for the June quarter. 

Hyperpure Updates

Hyperpure revenue increased by 29% sequentially and 126% YoY to Rs 617 crore in Q1FY24, driven by growth across the core restaurant supplies business and the newer quick commerce opportunity that they started tapping a few quarters earlier.

Dineout Business Update

The company has said in a statement that the dine-out business is shaping up well. Rs 515+ crore of GOV was transacted through Zomato Dine-out in India for the first quarter, which is ~7% of the GOV their food delivery business has done in the quarter. The segment is profitable, with an EBITDA margin of about 1% for the India business.