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Category: MAM

  • Colgate-Palmolive Q2 FY25 delivers record revenue, marks best quarter yet

    Colgate-Palmolive Q2 FY25 delivers record revenue, marks best quarter yet

    Mumbai: The toothpaste your dentist swears by in every ad has now cemented its dominance, not just in recommendations but in hard numbers. Colgate-Palmolive (India) Limited has smashed expectations in Q2 FY25, posting its strongest quarter yet with an impressive 10 per cent increase in net sales, making it the company’s best-performing quarter to date.

    Announced on 24 October 2024, the unaudited financial results highlight the continued strength of Colgate’s oral care portfolio amidst a challenging market landscape. With revenues climbing to Rs 1,609.2 crore compared to Rs 1,462.4 crore in the same quarter last year, Colgate’s ability to navigate economic headwinds while expanding its consumer base has been commendable.

    Under the leadership of MD & CEO, Prabha Narasimhan, Colgate’s strategy to reinforce its core product offerings—particularly in toothpaste—has paid off handsomely. The toothpaste segment posted a high single-digit volume growth, driven by trusted brands such as Colgate Maxfresh and Colgate Strong Teeth. Colgate’s toothbrush category also saw double-digit growth, reflecting a rising trend towards premiumisation in the oral care market.

    Even with an increase in advertising expenditure by 17.8 per cent year-on-year, which was used to boost brand visibility and market reach, the company’s Net Profit After Tax (NPAT) rose by a robust 16.2 per cent, reaching Rs 395.1 crore, up from Rs 340.1 crore in Q2 FY24. This profitability boost was further supported by a one-time credit from interest on income tax refunds received during the quarter.

    Narasimhan attributed the success to a mix of consistent product innovation and consumer engagement. “This was a big innovation quarter with the launch of Colgate Visible White Purple, a product that uses colour theory and builds on our growing whitening business. Early response has been excellent. In addition, we aired new communication on our flagship global offering – Colgate Total. With its patented Dual Zinc and Arginine Technology, Colgate Total offers the best everyday protection and is the cornerstone of our premiumisation strategy. Colgate Strong Teeth saw new advertising, built on the very relevant insight for today of increased snacking leading to increased loss of calcium and Colgate Strong Teeth with its arginine + calcium boost builds back this lost calcium” she said.

    Innovation has been the cornerstone of Colgate’s growth strategy. Besides product advancements, Colgate continued its community outreach with the Bright Smiles, Bright Futures® program, extending its reach through partnerships with the governments of Uttar Pradesh and Goa. The program now aims to impact the oral health habits of over two crore children in Uttar Pradesh and two lakh children in Goa, solidifying Colgate’s commitment to creating a healthier future for India.

    Additionally, Colgate has kept sustainability at the heart of its operations. As part of its broader corporate social responsibility initiatives, the company has made strides in reducing plastic waste and promoting recycling in its product packaging, enhancing both its environmental impact and consumer goodwill.

    In another positive move, Colgate’s board has declared a first interim dividend of Rs 24 per equity share for FY25, with a total payout of Rs 653 crore to be distributed to shareholders. This signals Colgate’s strong cash flow position and its continued focus on delivering shareholder value.

    Despite Colgate’s current success, Narasimhan remained cautious about future challenges, particularly those related to economic conditions and inflation. “We expect continued difficult market conditions but remain committed to leverage our very strong P&L which allows us to continue to invest behind superior products and advertising while we maintain our focus on ensuring better oral health for everyone in India,” she noted.

    Colgate’s Q2 FY25 results reflect a balance of innovation, aggressive market strategies, and consumer-centric growth. With its premiumisation initiatives and strong oral care products, the company is well-positioned to maintain its market leadership in India’s personal care sector. Investors will be keenly watching how the company manages the upcoming quarters, especially amid market uncertainties.

  • boAt partners with MTV Hustle 4 to amplify Indian hip-hop culture

    boAt partners with MTV Hustle 4 to amplify Indian hip-hop culture

    Mumbai : boAt, India’s leading audio wearable brand, is thrilled to announce its sponsorship of MTV Hustle 4- Hip Hop Don’t Stop, India’s premier hip-hop reality show. This partnership underscores boAt’s commitment to empowering creative expression and individuality, solidifying its position as a cultural icon resonating with the nation’s youth.

    From the streets to the spotlight, hip hop has emerged as the voice of India’s new generation, and boAt is committed to amplifying this movement. As Indian hip hop continues to break barriers and reshape cultural norms, boat is proud to support a platform that ensures these artists are heard, driving the culture forward with each beat. Hip hop has redefined how young India engages with music, fashion, and lifestyle, and boAt is excited to be a part of this transformation, empowering the next wave of creative talent to rise.

    boAt’s association with MTV Hustle 4 aligns seamlessly with the brand’s vision to foster a vibrant music ecosystem. The show’s platform will provide boAt with an unparalleled opportunity to connect with a passionate audience of hip-hop enthusiasts and music lovers across India. By supporting emerging talent and celebrating the rich tapestry of Indian hip-hop, boAt aims to inspire and empower the next generation of artists.

    “We are excited to partner with MTV Hustle 4, a show that has played a pivotal role in shaping India’s hip-hop landscape,” said, co-founder and CMO boAt Aman Gupta. “Our brand resonates with the energy, passion, and authenticity that the show embodies. Through this collaboration, we aim to amplify the voices of talented artists and contribute to the growth of the hip-hop culture in India.”

    As a brand that has consistently pushed boundaries and challenged conventions, boAt’s association with MTV Hustle 4 is a natural extension of its commitment to innovation and cultural relevance. The partnership will see boAt actively engage with the show’s audience through various initiatives, including product integrations, brand activations, and social media campaigns.

    Viacom18, head – youth, music, and English entertainment cluster Anshul Ailawadi said: MTV Hustle amplifies the voice and sentiment of India’s youth on a global stage. Since desi hip hop is about showcasing creative innovation, we’re happy to collaborate with a popular youth-centric brand like boAt, as they are influencing youth culture too, with differentiated tech experiences. I’m sure that our collaboration will drive a deeper connect with the young music communities across urban India.

    MTV Hustle 4 is set to captivate audiences with its high-octane performances, intense battles, and inspiring stories. With boAt’s support, the show promises to deliver an unforgettable experience for viewers and elevate the hip-hop scene in India to new heights.

  • Hindustan Unilever Q2 FY2025 sees 4 per cent decline in PAT amid competitive pressures

    Hindustan Unilever Q2 FY2025 sees 4 per cent decline in PAT amid competitive pressures

    Mumbai: Hindustan Unilever Limited (HUL), one of India’s largest fast-moving consumer goods (FMCG) companies, faced a mixed financial performance for the quarter ending September 2024 (Q2 FY2025). While the company managed to maintain a stable revenue flow, posting a modest 2 per cent year-on-year growth, its profit after tax (PAT) took a hit, declining by 4 per cent compared to the same quarter last year. This marked a challenging period for the consumer giant as rising input costs and sluggish consumer demand weighed down its profitability.

    The financial results released on 23 October 2024, indicate that HUL’s revenue from operations stood at Rs 15,319 crores, up from Rs 15,027 crores in Q2 FY2024. However, the company’s Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) margins saw a slight contraction. EBITDA for the quarter came in at Rs 3,647 crores, marking an 80 basis points (bps) decline to 23.8 per cent from 24.6 per cent in the same period last year.

    A key highlight from the results was the dip in PAT to Rs 2,612 crores, down from Rs 2,717 crores in Q2 FY2024, representing a 4 per cent decline. This drop was driven by multiple factors, including escalating material costs and competitive pricing pressures in key segments like personal care and home care. Additionally, the company faced an exceptional restructuring charge of Rs 16 crores during the quarter, further compressing net earnings.

    HUL’s executive director and company secretary, Dev Bajpai, commented on the results, stating: “While we continue to deliver on our commitment to revenue growth, profitability challenges are real. We are focused on operational efficiencies and agile strategies to navigate the cost pressures.”

    The company’s Home Care division reported a sales increase to Rs 5,737 crores, while Beauty & Wellbeing achieved sales of Rs 3,323 crores. Yet, Personal Care and Foods & Refreshment segments faced marginal declines, with Personal Care revenue dropping to Rs 2,412 crores.

    In a bid to reward shareholders, HUL declared an interim dividend of Rs 19 per equity share and a special dividend of Rs 10 per share for FY2025, totalling Rs 29 per equity share. The record date for the dividend is set for 6 November 2024, with the dividend payout scheduled for 21 November 2024. Despite the decline in PAT, HUL’s strong cash flow allowed it to maintain its dividend policy, signalling confidence in its long-term growth strategy.

    The FMCG giant remains cautiously optimistic about the future. The company continues to emphasise innovation, digital transformation, and a consumer-centric approach to fuel long-term growth. Commenting on the company’s outlook, MD & CEO Rohit Jawa said: “Our investments in innovation and sustainability are non-negotiable as we focus on both protecting margins and driving top-line growth in the challenging macroeconomic environment.”

    Looking forward, HUL’s ability to manage costs and drive sales growth in a competitive market will be crucial. With consumer preferences shifting and economic pressures persisting, the company must stay agile and innovate to regain momentum in the upcoming quarters.
     

  • Freedom Healthy Cooking Oils unveils branding at Moosapet Metro Station

    Freedom Healthy Cooking Oils unveils branding at Moosapet Metro Station

    Mumbai: Freedom Healthy Cooking Oils has boosted its visibility by branding Moosapet Metro Station in Hyderabad, now renamed Freedom Oil Moosapet Station. This move is part of the brand’s strategy to reach a wider audience and promote heart-healthy cooking oils. The station’s visuals highlight Freedom’s message of making healthy cooking accessible, showcasing oils like rice bran, sunflower, mustard, and groundnut, all low in saturated fats and rich in nutrients.

    Located in a busy area with thousands of daily commuters, the station provides Freedom with a platform to educate consumers on the health benefits of its oils, encouraging informed choices. This initiative supports the brand’s mission to promote healthier living and enhance its presence in one of Hyderabad’s busiest metro stations.

    Freedom Healthy Cooking Oils’ SVP of sales & marketing, P Chandrashekara Reddy said, “We at Freedom Healthy Cooking Oils are excited to be a part of the daily journey of thousands of commuters through our partnership with Moosapet Metro Station. This initiative reflects our mission to inspire healthier cooking habits by providing oils that are not only rich in nutrients but also support heart health. We hope to make a lasting impact on the community, encouraging people to make better choices for themselves and their families.”

  • Shoppers Stop faces tough quarter amid market challenges, posts losses

    Shoppers Stop faces tough quarter amid market challenges, posts losses

    Mumbai: Not long ago, weekends meant families, friends, and couples flocking to bustling malls, indulging in the joy of strolling through their favourite stores. But with the rise of online shopping, those scenes of leisurely retail therapy are fading into nostalgia, leaving traditional brands like Shoppers Stop to confront a new reality. The retailer’s latest quarterly results reveal a troubling stretch, as escalating costs and market pressures overshadow modest gains. Following its board meeting on 22 October 2024, Shoppers Stop reported a net loss for Q2 FY25, signalling deeper struggles in a rapidly evolving retail landscape.

    The company reported revenue from operations at Rs 1,114.87 crores for the quarter, marking a 4.2 per cent increase from Rs 1,069.31 crores in Q1 FY25 and a 4.5 per cent increase from Rs 1,068.10 crores in the corresponding period last year. However, the rise in sales was overshadowed by surging expenses, with total costs climbing to Rs 1,151.31 crores, driven largely by higher finance and depreciation expenses.  

    Commenting on the results, Shoppers Stop’s managing director Kavindra Mishra remarked, “While the growth in revenue is a positive sign, we are navigating a challenging macroeconomic environment that is putting pressure on our bottom line. Our focus remains on optimising costs while continuing to enhance the customer experience.”

    Shoppers Stop faced a significant decline in profitability, with a reported net loss of Rs 28.74 crores for Q2 FY25, up from a loss of Rs 22.70 crores in the previous quarter and a sharp contrast to the modest profit of Rs 1.78 crores in Q2 FY24. The key factor contributing to this downturn was an exceptional item of Rs 2.05 crores related to stock damage due to smoke from a nearby fire incident. Additionally, the company’s efforts to expand and modernise stores have led to increased lease liabilities and depreciation costs, which impacted margins.

    The loss reflects a broader struggle within the retail sector, as companies face subdued consumer sentiment and costly operations. Shoppers Stop’s finance costs alone surged to Rs 64.51 crores this quarter, up from Rs 61.01 crores in the previous quarter, while depreciation and amortisation rose to Rs 121.76 crores.

    Amidst the current challenges, Shoppers Stop is making strategic moves to navigate the difficult terrain. The retailer appointed Nishit Sheth as the interim company secretary and chief compliance officer to strengthen compliance and governance practices. This move, alongside ongoing investments in e-commerce and store refurbishments, is part of a broader strategy to rejuvenate the brand’s appeal.  

    The board’s approval of new stock options under the ESOP Scheme 2022 reflects a commitment to rewarding talent and fostering employee engagement during tough times. While these initiatives aim to position the company for future growth, the immediate outlook remains constrained by high operating costs and ongoing market uncertainties.

    The company’s balance sheet reveals a notable increase in liabilities. Total non-current liabilities climbed to Rs 2,466.48 crores from Rs 2,316.75 crores at the end of FY24, primarily due to additional borrowing and higher lease obligations. Additionally, total equity saw a reduction from Rs 301.42 crores to Rs 262.68 crores, further indicating financial pressures. Shoppers Stop’s cash flow statement also showed a decrease in cash reserves to Rs 13.89 crores from Rs 11.38 crores at the end of the previous quarter, underscoring liquidity constraints.

    As Shoppers Stop faces an uphill battle, industry analysts suggest that the retail sector’s recovery will be gradual. The company’s focus on improving operational efficiency and enhancing its digital footprint may drive incremental gains. However, substantial growth may be elusive in the near term unless broader economic conditions improve and consumer demand strengthens.  

    Summing up the challenges, CFO Karunakaran Mohanasundaram said, “The current macroeconomic scenario is indeed tough, but we are confident that our strategic interventions will gradually improve our financial position.” Despite these reassurances, the road ahead appears bumpy for Shoppers Stop as it navigates this period of financial strain.

  • Mahindra Logistics’ Q2 FY25 shows revenue growth, but profit declines

    Mahindra Logistics’ Q2 FY25 shows revenue growth, but profit declines

    Mumbai: In the crowded lanes of India’s logistics market, even giants can stumble. Mahindra Logistics, a cornerstone of the Mahindra Group, seems to be navigating through a challenging terrain. Despite the conglomerate’s success across other sectors, the logistics arm is struggling to turn growth into profit. The unaudited consolidated results for Q2 FY25, ending 30 September 2024, reveal a dynamic yet troubled picture—while revenues surged, profit margins hit a roadblock, hinting at both promising opportunities and deep-rooted operational hurdles.

    The company reported a consolidated revenue from operations of Rs 1,521.10 crores for Q2 FY25, marking an 11 per cent increase from Rs 1,364.76 crores during the same quarter last year. This growth was primarily driven by strong performance in the supply chain management segment, which saw increased demand across industries. However, the company’s profit trajectory didn’t mirror this upward trend.

    Profitability took a significant hit, with a net loss of Rs 10.75 crores compared to a loss of Rs 15.93 crores in Q2 FY24. Despite efforts to improve operational efficiency, rising expenses eroded the gains from higher revenue. Operating costs surged by 12 per cent, reaching Rs 1,306.85 crores, driven by increased freight rates and employee expenses.

    Mahindra Logistics’ managing director & CEO, Rampraveen Swaminathan, acknowledged the challenges, stating, “While we are encouraged by the revenue growth, the increase in operating costs continues to be a headwind, impacting overall profitability.” The company also saw higher finance costs due to rising borrowing expenses, which climbed to Rs 19.12 crores, up from Rs 16.53 crores in the previous year.

    Further complicating the financial landscape, depreciation and amortisation expenses rose by 4 per cent, amounting to Rs 53.96 crores. Although Mahindra Logistics expanded its asset base to support growth, these costs weighed heavily on its bottom line.

    The balance sheet showed a marginal improvement in total assets, increasing to Rs 2,595.52 crores as of September 2024, compared to Rs 2,477.20 crores in March. Despite this, the company’s debt-to-equity ratio escalated from 0.56 to 0.87 over the past year, signalling a higher reliance on borrowings.

    In the face of these challenges, Mahindra Logistics continues to push forward, prioritising cost control and strategic investments. The management is optimistic about improving margins in the upcoming quarters, driven by initiatives to streamline operations and optimise its supply chain network.

  • Adani Green Energy’s H1 FY25 revenue soars 20 per cent on capacity expansion

    Adani Green Energy’s H1 FY25 revenue soars 20 per cent on capacity expansion

    Mumbai: In a world marred by industrial grime and chemical plumes, a green energy beacon shines brighter than ever. Adani Green Energy Ltd (AGEL) emerges as a trailblazer, showcasing stellar results for the quarter and half-year ending September 30, 2024. The company’s remarkable growth story—driven by ambitious capacity expansion, surging energy sales, and shrewd financial strategies—cements its place at the forefront of India’s renewable energy revolution, where it continues to shape a cleaner, more resilient future.

    The company reported a 16 per cent year-on-year increase in quarterly revenue, reaching Rs 2,309 crores in Q2 FY25, driven by the addition of 2,868 MW in greenfield capacity and consistent plant efficiency. For the half-year period, revenue surged by 20 per cent to Rs 4,836 crores, while EBITDA rose 20 per cent to Rs 4,518 crores, maintaining an industry-leading margin of 92.2 per cent. Cash profit surged by 27 per cent to Rs 2,640 crores, reflecting the company’s operational prowess and disciplined cost management.

    CEO Amit Singh stated, “Our financial performance continues to be strong, driven by significant greenfield capacity additions and robust operational efficiency. Our entry into the commercial and industrial (C&I) segment and the redemption of a $750 million Holdco bond illustrate our commitment to sustainable growth and systematic deleveraging.”

    The recent redemption of the $750 million bond has markedly improved the company’s leverage ratios. This move, combined with a steady increase in operational capacity to 11.2 GW—an impressive 34 per cent year-over-year rise—positions AGEL for further growth. The ambitious development of a 30 GW renewable energy plant in Khavda, Gujarat, promises to set new benchmarks for the sector. The Khavda project is rapidly progressing, with 2 GW of solar and 250 MW of wind capacity already operational.

    The company’s use of advanced technologies like machine learning and AI for operations and maintenance continues to pay off, leading to a reduction in O&M costs. AGEL’s consistent electricity generation has not only met but exceeded annual commitments under power purchase agreements, reaching 57 per cent of the annual target in H1 FY25. Additionally, the company remains a leader in sustainability, maintaining top ESG rankings and setting ambitious decarbonisation targets, with a goal to achieve 50 GW of renewable capacity by 2030.

    While AGEL’s growth trajectory remains strong, the company faces ongoing challenges, including a volatile financing environment and ambitious expansion plans that necessitate substantial capital expenditure. Yet, the consistent reduction in leverage and strategic focus on high-margin segments bode well for sustaining growth. As the renewable energy sector matures, AGEL’s proactive measures and strong operational base position it favourably against its peers.

     

  • A Decade of Transformation and Perseverance at Ventes Avenues

    A Decade of Transformation and Perseverance at Ventes Avenues

    We have reached a significant milestone: 23 October 2024 marks ten years of Ventes Avenues in the AdTech industry. Diving into the past, it all started in a coffee house, where ideas were jotted down on paper napkins. Now, a decade later, we have grown into a team of 115 professionals working alongside us. A deep understanding of the evolving needs of advertising has been one of the key pillars of our success, along with building strong relationships and fostering transparency, which has always been at the heart of our operations. A key driver of our achievement is the multi-talented team we’ve assembled, always engaged in continuous learning. We remain nimble while strongly believing in the power of technology and marketing precision. Over the years, we have expanded our global network and leveraged our diverse media experience to serve our clients better.

    We focus on a few core principles that define who we are and how we operate. We are unwavering in our Client First approach, prioritizing our client’s needs and goals above all else. Our drive for excellence is fuelled by our technology-driven mindset, ensuring we stay ahead of industry trends and offer cutting-edge solutions. Innovation is at the forefront of everything we do; for us, marketing is about creating measurable impact with strategies backed by data, rooted in ROI-driven Marketing Precision. We employ multi-level targeting to ensure our campaigns are tailored for maximum effectiveness. Having direct control over our inventory enables us to fine-tune campaigns precisely, ensuring the brand’s message is delivered exactly where it matters most. Our collaborative environment fosters creativity and mutual growth within our team, while our commitment to diversity and inclusion ensures that a multitude of voices and ideas shape our strategies. Above all, we operate with integrity, staying true to our values and always delivering on our promises.

    As we look toward the future, we are excited to expand our market reach, having already ventured into Southeast Asia with a presence in Malaysia, Indonesia, Vietnam, and Singapore. Global collaboration is key to our vision, and diversification is in our DNA—from performance marketing to branding, technology solutions, and influencer marketing. Our strategic partnerships with clients, publishers, and agencies have driven our success, and we remain committed to nurturing these relationships. We prioritize empowering our employees to grow and nurture their entrepreneurial spirit. Through our relentless pursuit of innovation, we will continue evolving our offerings to meet and anticipate our clients’ needs, ensuring we stay at the forefront of industry trends and deliver impactful, forward-thinking solutions. Our client-first approach, grounded in trust and transparency, has built a lasting foundation for strong relationships, and we will continue leveraging technology to deliver cutting-edge solutions. By collaborating with global giants, we aim to provide personalized experiences that help brands achieve their goals. As we solidify our market presence, corporate social responsibility (CSR) remains a top priority, extending beyond societal impact to caring for our employees. With these principles, we look forward to a future of innovation, growth, and meaningful
    contributions to society and the environment.

    To our valued partners, clients, and agencies — thank you for being part of this incredible journey. Your trust and support have been vital to our success. And to our dedicated team — your passion and hard work continue to drive us forward. Together, we’ve achieved more than we ever imagined. We are
    deeply grateful to each and every one of you. As we look to the future, we remain confident that the best is yet to come. With a continued focus on
    innovation, growth, and meaningful contributions to society and the environment, there is so much more in store. We are excited for the road ahead and ready to embrace new opportunities, challenges, and successes together.

    Here’s to the next decade!

  • Zomato’s Q2 revenue climbs amid investments, profit margins narrow

    Zomato’s Q2 revenue climbs amid investments, profit margins narrow

    Mumbai: Picture this: you eagerly await the daily notification from your go-to food delivery app, its tempting offers making it hard to resist ordering your next meal. But imagine the silence when those notifications cease because the company behind them is grappling with shrinking profits.

    In a crucial board meeting on 22 October 2024, Zomato revealed a blend of progress and setbacks in its unaudited second-quarter FY25 results. Revenue soared to Rs 4,799 crores, a leap from Rs 2,848 crores in the same period last year, yet the quest for profitability remains distant. The food giant’s net profit slid to Rs 176 crores, falling from Rs 253 crores in the previous quarter, casting doubts on its ability to sustain momentum in the face of rising costs.

    Zomato’s latest financial results reveal a company grappling with the dual realities of scaling up while managing costs. The revenue from operations jumped by 68.5 per cent year-on-year, driven primarily by strong performance in the quick commerce and B2B segments. The company’s quick commerce revenue, which encompasses ultra-fast deliveries, grew to Rs 1,156 crores, an impressive 129 per cent increase compared to last year. Similarly, Hyperpure, its farm-to-fork supplies business, witnessed a near doubling of revenue to Rs 1,473 crores. Despite these gains, the rise in delivery charges and other associated expenses limited overall profitability gains.

    The company’s other major cost heads include advertising expenses and employee benefits, which escalated to Rs 421 crores and Rs 590 crores respectively for the quarter. Depreciation and finance costs also showed marked increases, contributing to a 60 per cent hike in total operating expenses year-on-year, reaching Rs 4,783 crores. The intensified spending has put pressure on margins, resulting in a modest profit before tax of Rs 237 crores, unchanged from the previous quarter. However, a sharp fall from the Rs 253 crores profit reported in the June quarter dampened the outlook.

    Notably, Zomato is strategically positioning itself for future growth through several investments and initiatives. The company approved a plan to raise Rs 8,500 crores through a qualified institutional placement, aimed at bolstering liquidity and fueling future expansion. The funds are expected to be directed toward scaling quick commerce operations and enhancing technological capabilities, which are essential in an increasingly competitive market.

    In a bold move towards diversification, Zomato acquired Orbgen Technologies Pvt Ltd and Wasteland Entertainment Pvt Ltd for a combined sum of Rs 2,014 crores. These acquisitions add movie ticketing and event management services under Zomato’s ‘Going Out’ segment, potentially unlocking new revenue streams beyond the food delivery space. Despite this, some analysts question whether Zomato is overextending itself by venturing into sectors outside its core business.

    The company also disclosed its acquisition of a minor stake in Byond Nxt Smart Home Pvt Limited, a nascent startup focused on innovative kitchen appliances, for a nominal Rs 6,000. This move aligns with Zomato’s strategic interest in supporting technologies that complement its broader food ecosystem.

    Amid the financial results, a cloud of uncertainty looms as Zomato continues to deal with tax issues. The company faces ongoing litigation regarding Goods and Services Tax (GST) on delivery charges, with demands from the West Bengal GST authorities totaling Rs 19 crores. Zomato maintains that it has a “strong case on merits” based on legal counsel. The outcome of these proceedings could significantly impact the company’s bottom line in the coming quarters.

    Market analysts have offered a mixed response to Zomato’s results, acknowledging the company’s ambitious growth while also raising concerns about profitability. With basic earnings per share at Rs 0.20, down from Rs 0.29 in the previous quarter, the company’s share price reflected investor caution. The board’s decision to proceed with a large fundraising initiative signals both confidence in future growth prospects and the need to shore up finances amid rising costs.

    Zomato CEO Deepinder Goyal, while addressing stakeholders, emphasised the need to balance short-term profitability with long-term growth investments. “We are committed to growing responsibly while expanding our product and service offerings. Our investments today will drive the future value we can deliver to our shareholders,” Goyal said.

    The results underline the challenges of navigating a fiercely competitive market, especially with rivals aggressively expanding their service portfolios. The quick commerce sector, while promising, remains a low-margin, high-investment business, demanding substantial capital to secure market share. Zomato’s ability to execute efficiently in this space will be crucial in sustaining investor confidence.

    Overall, Zomato’s latest results reflect a company still searching for a sustainable balance between growth and profitability. With significant revenue gains tempered by rising expenses, Zomato faces a critical period where strategic investments must yield not only market expansion but also tangible returns to justify ongoing capital outlay. The pressure to improve margins persists, especially as the company ventures into new business areas where success is not guaranteed. As the company rolls out its capital-raising efforts, the coming quarters will determine whether its growth trajectory can align more closely with investor expectations.