Zomato: The Super Brand idea worked. What is next?
Subscribe to enjoy similar stories. SuperApps don’t seem to work in India that well. Deepinder Goyal, founder and CEO of Zomato, learned this early on in his career.
While big conglomerates like Tata, Adani, and Reliance are struggling to generate profits from their SuperApps (Tata Neu, Adani One, and My Jio) despite having a vast customer base and pumping huge money, a new-age company has done it with a small set of targeted customers. Zomato turned around the profit metrics of food deliveries and is now out to replicate the same for its other ventures. While Swiggy is still running at a loss of ₹2,350 crore in FY24, Zomato reported a full-year profit of ₹351 crore.
Zomato beat Swiggy at its own game, despite entering the food delivery business later (2015) than Swiggy (2014). Profit is music to investors’ ears. The share market rewarded Zomato for the profits as its stock price soared 440% from ₹51 in April 2023, when the journey to profits began, to over ₹278 at present.
During this time, its net profit soared 126.5x from its first profit of ₹2 crore in the June 2023 quarter to ₹253 crore in the June 2024 quarter. Within three years of its IPO, Zomato joined the ₹2 trillion market cap club. Zomato found the road to sustainable and growing profits for five straight quarters.
Other platform businesses that launched their IPOs alongside Zomato are still struggling to sustain profits or grow them. Nykaa was the first to turn profitable in 2021 but failed to grow its profits. Meanwhile, Paytm is struggling to lower its losses.
Swiggy worked really hard to start the food delivery and quick commerce business from scratch. It had to bear the build-up cost. Zomato, on the other hand, worked smart by acquiring Uber Eats and
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