Zepto Secures USD 500 Million Funding, Eyes Late 2025 IPO

Zepto’s funding history has been robust, raising approximately USD 1.35 billion (around INR 11,570 crore) in 2024 through three major funding rounds:
– June 2024: USD 665 million at a valuation of USD 3.6 billion (pre-IPO round)
– September 2024: USD 340 million, boosting valuation to USD 5 billion
– November 2024: USD 350 million round led by Indian investors, including notable names such as Motilal Oswal, Mankind Pharma Family Office, and the RP Sanjiv Goenka Group

These funding rounds have received substantial support from both foreign venture capital firms and high-net-worth Indian family offices. However, the upcoming funding round, primarily led by foreign investors, is projected to decrease Indian ownership from 40% to around 35%. Despite this shift, co-founder and CEO Aadit Palicha has emphasized a commitment to achieving majority Indian ownership by the time of the IPO, recognizing the strategic advantages of domestic investor involvement.

Focus on Profitability and Operational Efficiency

As competitors like Blinkit (owned by Zomato) and Swiggy Instamart venture into high-margin sectors such as consumer electronics, Zepto is concentrating on operational efficiency and profitability. Palicha noted several key achievements:
– Attained EBITDA positivity in most dark stores
– Reported an annualized Gross Order Value (GOV) of USD 4 billion, tripling in just eight months
– Temporarily closed Zepto Café operations in smaller North Indian markets to mitigate cash burn
– Shifted focus to the expansion in Tier II and III cities, while solidifying its presence in metropolitan areas

An analysis by ICICI Securities highlighted that Blinkit and Swiggy Instamart outperformed the overall industry growth in Q1 of FY26 (April to June 2025), with GOV growth exceeding 25% compared to the sector’s sub-20% growth. In response, Zepto is aiming to enhance its technology infrastructure, optimize its supply chain, and deepen its market presence with the support of this new capital.

Looking ahead, while Zepto had initially anticipated an IPO in mid-2025, this has now been postponed to late 2025 or early 2026 due to market volatility and the company’s desire to achieve stronger profitability metrics. Unlike some of its competitors, Zepto is taking a disciplined approach to its financial management in preparation for the scrutiny of public markets.

The competitive landscape is intensifying, as Swiggy Instamart and Blinkit expand rapidly, while BigBasket and Flipkart Minutes leverage brand synergies to enter new sectors. Both global and domestic investors continue to invest heavily in the Indian e-grocery and quick commerce markets, betting on urban demand and increasing digitization.

In summary, Zepto’s recent funding round of USD 500 million is not just a financial milestone; it signals a strong investor appetite for scalable, technology-driven delivery models in a crowded marketplace. By achieving a valuation of USD 7 billion despite delays in its IPO, Zepto is positioning itself for disciplined growth, strategic alignment with domestic interests, and a clear pathway to profitability. As the company prepares for its next chapter in the public markets, it must balance growth with the need to demonstrate solid unit economics and governance. So far, Palicha and his team have navigated this complex landscape effectively.