Zepto to confidentially file draft IPO papers on December 26

Zepto’s IPO would also mean the top three quick commerce startups will all compete in the public markets, a landmark event for an industry that did not exist just 5-6 years ago.

Zepto is set to pre-file its draft red herring prospectus (DRHP) on December 26, under the confidential route, and look to list some time next year, people familiar with the developments told Moneycontrol, as the quick commerce unicorn looks to become one of the youngest startups to list on the stock exchanges.

The Bengaluru-based company was started in 2020 and will likely go public in 2026 – around six years since its inception. Honasa Consumer, which runs Mamaearth, went public about seven years after it was founded and had become one of the youngest unicorns to list on the Indian stock exchanges in 2023, among a few others.

“Zepto’s pre-filing work is done and it will likely inform all the stakeholders about the filing on December 26,” one of the persons cited above said.

The company did not immediately reply to Moneycontrol’s queries.

After Zepto goes public, the company will join the likes of Eternal, which runs Blinkit, and Swiggy which operates Instamart. Eternal currently has a market capitalisation of around $30 billion and Swiggy’s is around $12 billion as of December 25.

Moneycontrol was first to report, in September, Zepto had picked bankers and was likely to raise around $500 million via an IPO. While the valuation remains undecided, Zepto was last valued at around $7 billion during its private market fundraise this year, as exclusively reported by Moneycontrol. 

Zepto’s IPO would also mean the top three quick commerce startups will all compete in the public markets, a landmark event for an industry that did not exist just 5-6 years ago.

Quick commerce, which has gone from a good-to-have option to a must-have offering, has seen intense competition between Blinkit, Swiggy and Zepto. Other players like Tata’s BigBasket, Flipkart Minutes, Amazon Now are all adding to the competitive intensity.

In fact, a Moneycontrol analysis found that the top three players, Blinkit parent Eternal, Swiggy and Zepto, have together burnt nearly Rs 9,000 crore in the past nine to 11 months.

Nonetheless, the three companies are still sitting on huge piles of cash thanks to two qualified institutional placements (QIPs) of over $1 billion each by Eternal and Swiggy soon after listing.

The three companies, which primarily raised fresh monies to grow their quick commerce business, are together sitting on over Rs 40,000 crore in cash and cash equivalents, indicating they all have a war chest ready to outpace rivals to grab a larger share of the market.