Nomura Financial Advisory and Securities — an equity research firm, has hiked the valuation of Zomato to around ₹9,000 crore ($1.4 billion).
This development comes at a time when the start-up is said to be in talks with Chinese payments firm Ant Financial Services Group to raise about ₹1,280 crore in a new funding round.
In the report, Nomura analysts Ashwin Mehta and Rishit Parikh wrote:
Zomato, in our view, is the only global scalable India player with potential to target spending across the entire restaurant value chain—advertising, food ordering and table booking, while demonstrating growth with low customer acquisition costs.
The funding round, which Alibaba’s Ant Financials is expected to lead, was reported to likely hike the valuation of the food-tech startup to around $800-900 million.
HSBC Securities and Capital Markets, slashed the valuation of Zomato by half to just $500 million in May 2016. However, the startup’s biggest investor Info Edge disputed HSBC’s estimate.
Recently, the company, which operates in around 24 countries, announced that it has acquired Runnr — a food-tech and logistics startup, for an undisclosed amount.
For the year that ended March 31, 2017, Zomato Media — the food ordering arm of Zomato, reported an 80 percent jump in revenue to ₹11.38 crore. It also reported that cash-burn of the company fell 81 percent in FY17.
Some estimates suggests that Zomato’s sales could touch $300 million over five years to the fiscal year 2022, driven by a 4.5-fold increase in its advertising business and a 15 times scale-up in the food ordering vertical.