Quick Commerce Platform Zepto Gears Up For $5 Billion IPO In Second Half Of FY25; Reports

Zepto, the delivery startup, has set the wheels in motion for an Initial Public Offering (IPO) slated for the second half of the fiscal year 2025. Zepto has chosen three top-tier financial institutions-Axis Capital, Goldman Sachs, and Morgan Stanley-as advisors. According to a report from Moneycontrol, which cites anonymous sources, the IPO is expected to take place around August 2025.

According to sources cited in the report, Zepto's IPO aims to raise between $450 million to $500 million through the listing. However, there are still some unresolved aspects surrounding the offering. Specifically, details about the offer for sale (OFS)-which allows existing investors to sell shares during the IPO-are unclear at this stage.

The valuation of Zepto ahead of the IPO is another area that remains uncertain. The company was last valued at $5 billion in August 2023 after raising $340 million in funding led by General Catalyst, a US-based venture capital firm. However, analysts expect the company's valuation to rise further as it approaches its IPO.

An important prerequisite for Zepto's listing on Indian stock exchanges is shifting its base from Singapore to India. In past interviews, CEO Aadit Palicha has confirmed that the company would soon complete this relocation process. This move is essential as Indian laws require companies to be domiciled within the country to list on Indian exchanges.

Zepto has been aggressively raising capital in preparation for its public market debut. Just two months after completing a $665 million pre-IPO funding round, the company secured follow-on financing of $340 million on August 30, 2023. This latest round was led by General Catalyst and saw the participation of new investors, Dragon Fund and Epiq Capital, alongside existing backers such as StepStone, Lightspeed, DST, and Contrary.

This surge in funding has propelled Zepto's valuation to $5 billion, up significantly from its previous valuation of $1.4 billion in 2022. The company had gained unicorn status just a year ago when it raised $200 million.

Zepto's rapid rise is closely tied to the growth of India's quick-commerce market, a sector that has boomed since the onset of the COVID-19 pandemic. Founded by Aadit Palicha and Kaivalya Vohra in April 2021, Zepto capitalized on the shift in consumer behaviour during the pandemic, where lockdowns and curfews pushed many urban consumers toward online shopping for daily essentials.

According to consulting firm Redseer, India's quick-commerce market grew 77% in 2023 to reach $2.8 billion in gross merchandise value (GMV). This segment now accounts for 5% of India's overall e-commerce market. The demand for faster delivery services, especially in metros like Mumbai, Bengaluru, and Delhi, has been a significant driver of this growth.

Zepto's IPO in FY25 will undoubtedly be one of the most closely watched public offerings in India's startup ecosystem. The startup has already captured the attention of global and domestic investors, thanks to its strong growth trajectory and the booming quick-commerce sector. With the backing of prominent financial advisors like Axis Capital, Goldman Sachs, and Morgan Stanley, Zepto is positioning itself for a successful listing that could potentially raise half a billion dollars.