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Analysis on Zomato

Never have a bad meal

Submitted by-

Pallavi Lenka 21202053

Nikita Tewary 21202310

Umesh Kumar Choraria 21202315

Aman Mishra 21202303

Gopi Kumar 21202045

Rishabh Kumar 21202059

Anisha Rani Nayak 21202018

ACKNOWLEDGEMENT
We would like to thank PROF. R N SUBUDHI sir, the Father, Guide and the
Friend like figure who gave me this opportunity to work on this project. We got
to learn a lot from this project about. At last, we would like to extend our
heartfelt thanks to people who contributed from the beginning to the end for
completion of this project.
 INTRODUCTION
Zomato is among the leading online food services platforms. It is listed as an
online market aggregator that connects customers to a partnered chain of local
restaurants. Its B2C model has achieved success in both food delivery and
dining-out segments.

Zomato generates revenue from Zomato Pro, a customer loyalty program, and
Hyperpure, which is involved with the supply of kitchen products and quality
ingredients to restaurants. The company’s efficient on-time delivery network
and robust 169802+ delivery partners favour its brand image.

FINANCIAL HIGHLIGHTS
Financial Year Total Revenue Total Assets Profit After Tax

March 31 2019 Rs 13,977.17 Million Rs 34,134.05 Million Rs 10,105.14 Million

March 31 2020 Rs 27,427.39 Million Rs 29003.82 Million Rs 23,856.01 Million

March 31 2021 Rs 21,184.24 Million Rs 87,035.43 Million Rs 8,164.28 Million

Zomato Ltd.
This the key ratios, its comparison with the sector peers and 5 years of Balance Sheet.
DEBT EQUITY RATIO

-0.36chg.
0.06%
PEER RANGE
0.00

0.06
CURRENT RATIO

8.48chg.
8.89%
PEER RANGE
0.20

8.89
RETURN ON ASSETS

27,628.40bps
-10.79%
PEER RANGE
-10.79

37.67

BalanceSheet - Zomato Ltd.

Rs (in Crores)

Particulars Mar'21 Mar'20 Mar'19 Mar'18 Mar'15

Liabilities 12 Months 12 Months 12 Months 12 Months 12 Months

Share Capital .03 .03 172.43 72.46 149.33

Reserves & Surplus 7754.50 601.41 2792.09 1172.31 512.53

Net Worth 7754.53 601.44 2964.51 1244.77 661.87

Secured Loan 454.93 252.40 243.72 174.38 .00

Unsecured Loan .00 .00 .00 .00 .03

TOTAL LIABILITIES 8209.46 853.84 3208.24 1419.14 661.89

Assets

Gross Block 1527.47 1643.91 81.53 41.95 21.52

(-) Acc. Depreciation 76.96 64.40 47.09 37.75 7.54

Net Block 1450.52 1579.51 34.45 4.20 13.98

Capital Work in Progress .13 .77 .74 1.29 2.10

Investments 2505.84 524.23 2798.49 1237.25 633.93

Inventories .00 .00 .00 .00 .00

Sundry Debtors 123.71 132.72 62.66 19.05 8.95

Cash and Bank 765.18 279.38 152.50 146.65 13.03

Loans and Advances 3902.86 468.75 765.32 104.23 11.12

Total Current Assets 4791.75 880.84 980.49 269.92 33.10

Current Liabilities 514.20 2113.69 592.70 86.08 20.28

 Provisions 24.57 17.82 13.23 7.44 .95

Total Current Liabilities 538.78 2131.50 605.93 93.52 21.23

NET CURRENT ASSETS 4252.98 -1250.66 374.56 176.41 11.87

Misc. Expenses .00 .00 .00 .00 .00

TOTAL ASSETS(A+B+C+D+E) 8209.46 853.84 3208.24 1419.14 661.89

Rs (in Crores)

Zomato Profit / Loss sheet:-

Gross Sales 1993.80 2604.70 -23.45

     Sales 200.20 107.60 86.06
     Job Work/ Contract Receipts NA NA NA
     Processing Charges / Service Income 1793.60 2497.20 -28.18
     Revenue from property development NA NA NA
     Other Operational Income 0.00 0.00 0.00
Less: Excise Duty NA NA NA
Net Sales 1993.80 2604.70 -23.45
EXPENDITURE : NA NA NA
Increase/Decrease in Stock -11.00 -1.60 -587.50
Raw Material Consumed 202.90 110.50 83.62
     Opening Raw Materials NA NA NA
     Purchases Raw Materials NA NA NA
     Closing Raw Materials NA NA NA
     Other Direct Purchases / Brought in cost 202.90 110.50 83.62
     Other raw material cost 0.00 0.00 0.00
Power & Fuel Cost 1.90 6.30 -69.84
     Electricity & Power 1.90 6.30 -69.84
     Oil, Fuel & Natural gas 0.00 0.00 0.00
     Coals etc 0.00 0.00 0.00
     Other power & fuel 0.00 0.00 0.00
Employee Cost 740.80 798.90 -7.27
     Salaries, Wages & Bonus 557.70 645.20 -13.56
     Contributions to EPF & Pension Funds 16.20 19.60 -17.35
     Workmen and Staff Welfare Expenses 15.60 29.20 -46.58
     Other Employees Cost 151.20 104.80 44.27
Other Manufacturing Expenses 653.50 2167.60 -69.85
     Sub-contracted / Out sourced services 589.90 2093.80 -71.83
     Processing Charges NA NA NA
     Repairs and Maintenance 0.00 0.00 0.00
     Packing Material Consumed NA NA NA
     Other Mfg Exp 63.60 73.80 -13.82
General and Administration Expenses 328.30 430.20 -23.69
     Rent , Rates & Taxes 77.50 45.00 72.22
     Insurance 11.40 19.80 -42.42
     Printing and stationery 0.20 0.80 -75.00
     Professional and legal fees 37.70 76.00 -50.39
     Traveling and conveyance 17.10 44.80 -61.83
     Other Administration 201.50 288.70 -30.20
Selling and Distribution Expenses 527.60 1341.30 -60.67
     Advertisement & Sales Promotion 527.10 1338.40 -60.62
     Sales Commissions & Incentives 0.60 2.80 -78.57
     Freight and Forwarding NA NA NA
     Handling and Clearing Charges 0.00 0.00 0.00
     Other Selling Expenses 0.00 0.00 0.00
Miscellaneous Expenses 24.90 88.50 -71.86
     Bad debts /advances written off 8.80 13.80 -36.23
     Provision for doubtful debts 11.30 44.80 -74.78
     Losson disposal of fixed assets(net) 0.10 NA NA
     Losson foreign exchange fluctuations NA 0.10 NA
     Losson sale of non-trade current investments NA 26.10 NA
     Other Miscellaneous Expenses 4.60 3.70 24.32
Less: Expenses Capitalised NA NA NA
Total Expenditure 2468.90 4941.60 -50.04
Operating Profit (Excl OI) -475.10 -2336.90 79.67
Other Income 132.50 170.20 -22.15
     Interest Received 22.40 26.50 -15.47
     Dividend Received NA NA NA
     Profit on sale of Fixed Assets NA 0.10 NA
     Profits on sale of Investments 54.00 77.60 -30.41
     Provision Written Back 9.00 29.50 -69.49
     Foreign Exchange Gains 2.50 NA NA
     Others 44.70 36.60 22.13
Operating Profit -342.50 -2166.70 84.19
Interest 10.10 12.60 -19.84
     InterestonDebenture / Bonds NA NA NA
     Interest on Term Loan NA NA NA
 Interest on Fixed deposits NA NA NA
Bank Charges etc 1.40 1.60 -12.50
Other Interest 8.60 11.00 -21.82
PBDT -352.60 -2179.30 83.82
Depreciation 137.70 84.20 63.54
Profit Before Taxation & Exceptional Items -490.40 -2263.60 78.34
Exceptional Income / Expenses -324.80 -122.00 -166.23
Profit Before Tax -815.10 -2385.60 65.83
Provision for Tax 1.30 NA NA
     Current Income Tax 1.30 NA NA
Deferred Tax NA NA NA
Other taxes 1.30 0.00 0.00
Profit After Tax -816.40 -2385.60 65.78
Extra items NA NA NA
Minority Interest 3.60 18.40 -80.43
Share of Associate NA NA NA
Other Consolidated Items NA NA NA
Consolidated Net Profit -812.80 -2367.20 65.66
Adjustments to PAT NA NA NA
Profit Balance B/F -4666.40 -2253.30 -107.09
Appropriations -5479.20 -4620.50 -18.58
General Reserves NA NA NA
 Proposed Equity Dividend NA NA NA
 Corporate dividend tax NA NA NA
 Other Appropriation 121.10 45.80 164.41
Equity Dividend % NA NA NA
Earnings Per Share -26220.00 -78905.00 66.77
Adjusted EPS -26220.00 -78905.00 66.77
In the last few quarters, as is evident from the charts above, we fast
tracked our efforts towards
making our business profitable and drive efficiency into our spends. While
COVID-19 has
impacted the size of our business, it has accelerated our journey to
profitability. In terms of the
size of the business, COVID-19 has set us back by a year or so – but a
year is only a small blip
when you are building a company for the next 100 years.
Having said that, COVID-19 has positively impacted the health of our
business – we seem to have
gained 2-3 years along this vector. In July 2020, we estimate our monthly
burn rate to land under
$1m, while our revenue should land at ~60% of pre-COVID peaks ($23m
per month). We expect to
make complete recovery over the next 3-6 months while continuing to
maintain tight control on
costs/profitability.
2a – India Food Delivery
FY20 was a defining year for food delivery in India. While FY19 saw hyper-
competition between 4
well-funded food delivery players, FY20 ended with a two player market
structure.
Zomato’s FY20 India Food Delivery GMV grew by 108% over FY19.
We acquired Uber Eats India
business in January 2020 which
helped propel us to market
leadership in this hotly
contested space. The transition
of users and merchants from
Uber Eats India to Zomato was
swift, and so well coordinated
by both the teams that we were
able to transfer and retain 97%
of the combined GMV on the
Zomato app.
Right after the rise of COVID-19
cases in India towards the end of
March, our food delivery GMV
hit its lowest point in two years –
GMV was 80% down in the last
week of March 2020, compared
to our peak pre-COVID-19 week
(in mid February).
As of now, our food delivery GMV has recovered to 60% of pre-COVID
levels. We have taken a
number of important steps to ensure safety of our food delivery customers,
which has been a
significant driver of the rebound in our business so far.
Most of the remaining delta in demand is due to young professionals in
large cities migrating to
their parents’ homes (often in small town India) where home cooked food is
the norm, especially
during a pandemic.
As offices start opening up, these professionals are now starting to move
back to the larger
cities. We expect sharp recovery in our order volumes as lockdowns
continue to ease and the
operating environment continues to improve.
The unit economics of our food delivery business have improved
consistently over the last 18
months. In Q1 FY20, we used to make a contribution margin of –₹47 per
order; in Q1 FY21, we
made a contribution margin of +₹27 per order.