- Zomato Q4 Results: Following the announcement, Zomato’s share price declined 6% during the early Tuesday trade. Zomato’s shares fell 5.98% to ₹182.10 per share on the BSE.
Zomato Q4 Results:
The company’s performance significantly improved, with a consolidated net profit of ₹175 crore. This is a substantial increase from a loss of ₹188 crore in the same period a year ago and a 27% growth from ₹138 crore posted in the December quarter.
Revenue: ₹3,562.0 cr (▲73.3%) Net Profit: ₹175.0 cr (▲193.1%)
Zomato Q4 Results: FINANCIAL HIGHLIGHTS
• Revenue from operations and net profit improved sequentially by 8.3% and 26.8%, respectively.
• Employee benefit expense increased both on a QoQ and YoY basis. As a % of revenue, it stood at 13.5% in Q4 FY24 compared to 12.9% in Q3 FY24.
• The ESOP cost in Q4 FY24 was ₹161 crore v/s ₹122 crore in Q3 FY24.
• Cash balance as on 31st March 2024 was ₹12,241 crore as compared to ₹12,015 crore as on 31st December 2023.
Zomato Q4 Results: BUSINESS HIGHLIGHTS
• Adjusted revenue (including customer delivery charges) grew by ~1% QoQ and ~61% YoY to ₹3,873 crore in Q4 FY24. In FY24, it grew by 56% to ₹13,545 crore. The top-line growth continued to trend above the guidance of ~40%+ because of strong contributions from delivery & quick commerce.
• The customer delivery charges added to the adjusted revenue was ₹278 crore, down by ~13% QoQ due to the Zomato Gold impact.
• The platform fee added in the revenue was ₹33 crore v/s ₹37 crore in Q3 FY24.
• Adjusted EBITDA stood at ₹194 crore in Q4 FY24 as compared to EBITDA loss of ₹175 crore in Q4 FY23. FY24 EBITDA was ₹372 crore. Margin expansion continued its trajectory in both food delivery and quick commerce, with the quick commerce being Adjusted EBITDA break-even during the quarter.
FOOD DELIVERY BUSINESS
• Gross order value (GOV) declined by ~0.6% QoQ and increased by 28% YoY to ₹8,439 crore in Q4 FY24.
• The 28% YoY growth was driven by 5% AOV (average order value) and 23% YoY orders growth. The order growth was driven by a 14% growth in average monthly transacting users and a 7% growth in average monthly order frequency.
• Adjusted revenue was ₹2,050 crore during the quarter as compared to ₹2,062 crore in Q3 FY24.
• On the profitability front, contribution as a percentage of GOV increased to 7.5% in Q4 FY24 compared to 7.1% in Q3 FY24.
• Food delivery adjusted EBITDA improved by 9% QoQ and stood at ₹275 crore in Q4 FY24.
• The adjusted EBITDA as a % of GOV was 3.3% v/s 1.2% in Q4 FY23, driven by higher AOV, improvement in take rate & ad income monetisation, introduction of platform fee and cost efficiencies. Together, these factors compensated for the lower customer delivery fee because of the free delivery benefit on Gold orders.
• Average monthly transacting customers increased on a QoQ basis to 19 million in Q4 FY24 compared to 18.8 million in Q3 FY24.
• In Q4 FY24, the average monthly active food delivery restaurant partners stood at 2,70,000 and the average monthly active delivery partners were 4,18,000, compared to Q3 FY24 levels of 2,54,000 and 4,19,000, respectively.
HYPERPURE (BUSINESS TO BUSINESS (B2B) SUPPLIES)
• Revenue grew by ~10.7% QoQ and ~99% YoY to ₹951 crore in Q4 FY24.
• Adjusted EBITDA loss stood at ₹23 crore in Q4 FY24 v/s ₹34 crore of loss in Q3 FY24. BLINKIT (QUICK COMMERCE)
BLINKIT (QUICK COMMERCE)
• GOV grew by ~14% QoQ and 97% YoY to ₹4,027 crore in Q4 FY24 due to increased order frequency and more number of stores.
• The average GOV per day per store was ₹9,20,000 as compared to ₹8,89,000 in Q3 FY24.
• The segment’s adjusted revenue grew by 19% sequentially to ₹769 crore in Q4 FY24.
• AOV (average order value) during the quarter was ₹617,, down from ₹635 in Q3 FY24, majorly due to seasonality.
• The contribution margin improved to 3.9% in Q4 FY24 v/s 2.4% in Q3 FY24.
• In Q4 FY24, adjusted EBITDA (as % of GOV) improved to -0.9%, from -2.5% in Q3 FY24 and -9.9% in Q4 FY23.
• The number of orders placed during Q4 FY24 was 6.53 crore as compared to 5.58 crore in Q3 FY24.
• In Q4 FY24, they expanded the presence by adding 75 net new stores. The number of stores as of 31st March 2024 stood at 526.
• The top 8 cities would be the focus of expansion; of the new stores added, ~80% are in these cities. Delhi would continue to be the largest contributor, with enough room to grow.
• Delhi NCR (national capital region) grew by 7% QoQ, driven by the addition of new stores and growth in demand from existing stores.
• The take rate increased by ~1% YoY during the quarter. The growth was a mix of product margins, delivery charges, and ad income, and these factors will continue to drive future growth. GOING OUT
• GOV grew by ~25% QoQ and stood at ₹1,069 crore in Q4 FY24.
• The segment’s revenue grew by ~27% sequentially to ₹93 crore in Q4 FY24.
• Adjusted EBITDA loss stood at ₹11 crore in Q4 FY24 v/s a profit of ₹1 crore in Q3 FY24.
UPDATES
• They have created an additional ESOP pool of 2% of their outstanding share capital.
Zomato FUTURE OUTLOOK
• The company anticipates the top line will sustain a growth rate exceeding 40% YoY.
• They believe it will grow faster than the restaurant industry if it continues innovating using customer-first principles.
• The company plans to add 1,000 stores to the quick commerce business by FY25, with a contribution break-even in the next 2-3 months. In Q1 FY25, they plan to add 100 stores.
• In the longer term, the top 4 metro cities would have ~500 stores each. • The target Adjusted EBITDA margin (as a % of GOV) for the quick commerce business would be ~4%5%.
• They would try expanding in regions like Bengaluru and Mumbai along with the top 4 cities to reach the Delhi contribution levels regarding store footprint and GOV. This alone would lead to a ~4x increase in their GOV.
• The ESOP costs would further increase in FY25 due to the grant of ESOPs to the Blinkit leadership team and senior employees.
• The company foresees GOV (food delivery) growing at more than 20% YoY, with the possibility of further acceleration driven by a mix of higher AOV and increased user base.
• They plan to expand into Bengaluru and Mumbai for their ‘Zomato everyday’ segment.
• The Hyperpure growth would moderate going ahead as the low base effect normalises.
• The ad income is anticipated to increase in the Blinkit segment.
• There could be slight volatility in the average take rates for Blinkit due to the seasonal effect of both AOV and product mix.
• The Blinkit monthly transacting users (MTU) could grow faster than the company’s MTUs.
Disclaimer: This document summarises a conference call for learning purposes only and does not constitute a recommendation on any stocks or sectors.
Zomato Q4 Results: Frequently Asked Questions (FAQs)
1. What was Zomato’s net profit in Q4 FY24?
Answer: Zomato’s consolidated net profit in Q4 FY24 was ₹175 crore, a significant increase from a loss of ₹188 crore in the same period a year ago.
2. How did Zomato’s adjusted revenue and EBITDA in Q4 FY24?
Answer: Zomato’s adjusted revenue (including customer delivery charges) grew by approximately 1% QoQ and 61% YoY to ₹3,873 crore in Q4 FY24. Adjusted EBITDA stood at ₹194 crore compared to an EBITDA loss of ₹175 crore in Q4 FY23.
3. What was Zomato’s cash balance as of 31st March 2024?
Answer: Zomato’s cash balance as of 31st March 2024 was ₹12,241 crore, compared to ₹12,015 crore as of 31st December 2023.
4. What is the growth rate of Zomato’s food delivery business?
Answer: Zomato’s food delivery business had a 28% YoY growth in Q4 FY24.
5. What is the target Adjusted EBITDA margin for Zomato’s quick commerce business?
Answer: The target Adjusted EBITDA margin (as a % of GOV) for the quick commerce business would be ~4%-5%.
6. What are Zomato’s plans for expansion?
Answer: Zomato plans to add 1,000 stores to the quick commerce business by FY25, expand into regions like Bengaluru and Mumbai, and add 500 stores each in the top 4 metro cities.
