Online food delivery and restaurant discovery platform Zomato, which got a green signal from the market regulator Securities and Exchange Board of India (SEBI) last week, is likely to roll out its much-awaited initial public offering (IPO) on July 19.

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Initially, the company plans to issue shares worth Rs 9,375 crore at a price band of Rs 70-72 per share, according to an Economic Times report. This will be the second-biggest IPO in the past four years.

If the share price is kept at Rs 72, the company, backed by China's Ant Group, will reach a valuation of $7.6 billion (Rs 56,240 crore). If that happens, the company will surpass Amazon-backed British food delivery Deliveroo and Nasdaq-listed Grubhub, added the report.

The unofficial market for unlisted shares is equally enthusiastic about the proposed IPO rollout. The company's stock is trading at Rs 78-80, around 12% above the projected IPO price of Rs 70-72, in the grey market.

The online food ordering platform said that the proceeds from the fresh issue will be used towards ‘funding organic and inorganic growth initiatives and general corporate purposes’.

Earlier in February, Zomato had raised $250 million (more than Rs 1,800 crore) in funding from Tiger Global, Kora, and other investors. Thereafter, the value of the company had shot up to $5.4 billion.

Meanwhile, Zomato's early investor Info Edge India Limited reduced its offer for sale (OFS) size in Zomato's IPO to Rs 375 crore on Monday. The company has earlier announced Rs 750 crore OFS in the IPO.

In an exchange filing on July 4, Info Edge India said, "The revised OFS by the company would comprise of such number of equity shares held by the company in Zomato, as would aggregate up to ₹3,750 million, the terms and conditions of which will be specified in the red herring prospectus and the prospectus filed in relation to the offer, and in other Offer related documents and agreements."

On the other hand, Zomato's major rival Swiggy is valued at $5 billion. In April this year, Swiggy has raised $800 million from several investors.

First Published:Jul 6, 2021 1:39 PM IST