Aug 29 (Reuters) - Indian grocery startup Zepto said on

Thursday it has raised $340 million in a fresh round, just two

months after its last fundraise.

In the latest round led by General Catalyst, the

three-year-old company was valued at $5 billion, a sharp rise

from $3.6 billion in June.

Zepto, which raised more than $1 billion in just two months,

also saw existing investors such as StepStone, Lightspeed, DST,

and Contrary increase their stakes.

Its co-founder and CEO Aadit Palicha said the company would

use the funds to strengthen its balancesheet as it continues to

deliver robust growth.

Indian customers are increasingly adopting quick commerce

services, which have expanded beyond groceries to sell mobile

phones, tech accessories and gifting items.

This has heated up competition for e-commerce giants such

as Amazon.com ( AMZN ) and Walmart ( WMT )-owned Flipkart and

squeezed the neighborhood mom-and-pop stores.

Zepto had a 28% market share as of January 2024, up from 15%

in March 2022, according to HSBC. Blinkit had a 40% market share

as of January and Instamart had 32%.

(Reporting by Disha Mishra and Haripriya Suresh in Bengaluru;

Editing by Arun Koyyur)