Online food delivery platform Zomato on Monday said its consolidated net loss in the first quarter of the current financial year almost halved to Rs 186 crore due to higher income.
The company had reported a net loss of Rs 360.7 crore in the year-ago period.
During the quarter under review, the company's total income rose to Rs 1,582 crore against Rs 916.6 crore in the corresponding period of last year.
However, its total expenses also shot up to Rs 1,767.7 crore from Rs 1,259.7 crore, the company said in a regulatory filing.
In a letter to shareholders, Deepinder Goyal, Managing Director & Chief Executive Officer, tried to address questions regarding the transaction value for the acquisition of Blinkit, formerly Grofers, and poor corporate governance.
"Firstly, we objectively evaluated all available acquisition opportunities in the quick commerce space and after zeroing in on Blinkit, we ensured that rigorous and detailed due diligence, deliberations, and negotiations were done before agreeing to the terms of the transaction (like any other company would do for a large and important transaction)," Goyal said.
"We negotiated hard on valuation but at the same time had no intention to be opportunistic since it is important to be fair to the team on the other side who is going to build this business going forward."
He also informed us that there is no plan to make any more minority investments as the company is in cash conservation mode, and busy executing what it already has on its plates right now.
On questions regarding poor corporate governance around the Blinkit deal, Goyal said: "The objective of good corporate governance is to protect the rights of minority shareholders. The ultimate test of corporate governance for this transaction was the requirement of approval from at least 75 per cent of our voting shareholder base. The outcome was that 97 percent-plus of the shareholders' votes were in favor of the transaction."
Zomato's Chief People Officer Akriti Chopra is married to Blinkit founder Albinder Dhindsa.
Sharing an update on when the transaction with Blinkit is expected to close, Zomato's Chief Financial Officer Akshant Goyal said: "We have received the shareholders' approval for the transaction. 97 per cent-plus votes were in favor of the transaction. We are now awaiting approval from stock exchanges. The financials of Blinkit will start getting consolidated into Zomato's consolidated financials post the closing."
Sharing insights into Zomato's performance in the first quarter of FY23, Akshant said its adjusted revenue grew by 18 per cent quarter-over-quarter and 56 per cent year-over-year to Rs 1,810 crore.
At the same time, adjusted EBITDA loss reduced to Rs 150 crore (-8 per cent of adjusted revenue) in Q1 FY23 as compared to Rs 220 crore (-15 per cent of adjusted revenue) in Q4 FY22, he added.