Zepto, the Indian quick-commerce startup, is looking to raise about Rs 1,000 crore (around $105 million) in pre-IPO funding and has delayed its listing plans, according to Business-Today, citing people familiar with the matter. The company is targeting a valuation of around $4–4.5 billion for the investment, more than 30% below the $7 billion valuation at which it raised $450 million in October last year, the report said.
The funding push comes after differences over valuation stalled Zepto's planned public listing, which had initially been targeted for July. Business-Today reported that the company had tempered its IPO valuation expectation to around $5.1 billion, while domestic investors valued the business at roughly $3–3.5 billion and foreign investors had indicated interest at a pre-money valuation of $4.5 billion.
Funding Round and Investor Sentiment
Zepto has received interest from existing investors for the pre-IPO round, and the company's priority is to get backing from domestic investors, according to a person aware of the discussions. Currently, the company's domestic shareholding stands at over 40%, the report noted.
Zepto has received interest from existing investors for the round. For the company, the priority is to get backing from domestic investors.
— a person aware of the discussions, as reported by Business-Today.
The startup plans to close the pre-IPO round in a couple of weeks, after which it will have to file the RHP (Red Herring Prospectus) with the Securities and Exchange Board of India (Sebi). Business-Today also reported that Zepto is likely to trim the issue size originally targeted at up to Rs 8,010 crore through a fresh issue of shares.
| Metric | Details |
|---|---|
| Pre-IPO round size | |
| Indicative valuation for round | $4–4.5 billion |
| Valuation at last funding (Oct last year) | $7 billion ($450 million raised) |
| Domestic investors' valuation | ~$3–3.5 billion |
| Foreign investors' pre-money valuation | $4.5 billion |
| Tempered IPO valuation expectation | ~$5.1 billion |
| Original IPO issue size (fresh issue) | Up to Rs 8,010 crore |
| Domestic shareholding | Over 40% |
IPO Plans Delayed and Peer Pressure
Zepto was initially targeting a public listing by July, but differences over valuation stalled the process. The company's tempered valuation expectation of around $5.1 billion still sits well above the $3–3.5 billion range that domestic investors were willing to assign, according to Business-Today.
The quick-commerce startup joins fintech peer PhonePe, which also paused its IPO plans partly over a valuation mismatch, the report said. For Zepto, the pre-IPO round will be followed by an RHP filing with Sebi once it closes in a couple of weeks.
Competitive Pressures in Quick Delivery
Business-Today attributed investor wariness to rising competition in the quick delivery space, which is making investors wary of long-term growth prospects. Amazon and Flipkart are ramping up their footprint aggressively, the report said.
For finance executives and treasury professionals tracking Indian private capital markets, the numbers indicate a significant repricing of quick-commerce assets: the $4–4.5 billion target implies a 30%-plus discount to the company's last round, and the trimmed IPO issue size signals caution on public-market appetite. The company's domestic shareholding stands at over 40%, a figure that underscores the emphasis on domestic investor backing as Zepto moves toward its eventual Sebi filing.
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