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Zepto Cafe hits pause in smaller cities amid supply chain woes and high burn

EntrackrEntrackr · 2m ago
Zepto Cafe hits pause in smaller cities amid supply chain woes and high burn
Medial

Zepto Cafe has temporarily closed in several smaller North Indian cities, including Agra, Chandigarh, Meerut, Mohali, and Amritsar. Around 44 cafes have shut down, affecting over 400 employees, including some from newly opened locations. The closures are happening due to rising costs and supply chain issues. A Moneycontrol report says Zepto was spending Rs 250–300 crore per month late last year. Recently, that spending has dropped to about Rs 95 crore a month, down from Rs 115–120 crore in March and Rs 105–110 crore in January and February. A big factor is Zepto’s push to hire more staff. The Aadit Palicha-led company is reportedly trimming store teams from nine people to seven or eight to lower expenses and streamline operations. In a statement to ET Now, the company confirmed that the impacted outlets have been put on hold to resolve ongoing supply chain challenges. Zepto said it expects to resume operations in these locations by the end of the next quarter. “We remain committed to the cafe business and will invest aggressively going forward,” a spokesperson added. Despite the turbulence, Zepto maintains an optimistic outlook. The company reported crossing 1,00,000 daily orders in February and expects that number to triple within the next 12 months. This development comes as major competitors revisit their rapid food delivery strategies. Zomato recently shut down its 10-15 minute food delivery service, while Swiggy has scaled up Swiggy Bolt to more than 500 cities.

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Zepto delays IPO plans to 2026: Report

EntrackrEntrackr · 1m ago
Zepto delays IPO plans to 2026: Report
Medial

Zepto delays IPO plans to 2026: Report Zepto, the quick commerce company, has reportedly postponed its plans to launch an initial public offering (IPO) to 2026. According to a report by Moneycontrol, this represents a change from the company’s earlier timeline, in which co-founder and CEO Aadit Palicha had indicated a listing in 2025. The report noted that the company is unlikely to go public this year, even if it files its draft red herring prospectus (DRHP) in the coming months. The IPO timeline has reportedly been extended multiple times, with internal discussions highlighting the need for stronger financial metrics before pursuing a public listing. Zepto is currently focused on reducing its cash burn and improving profitability before entering the public markets. Queries sent to Zepto did not elicit an immediate response. Due to rising operational costs, Zepto Cafe, the food service unit of Zepto, has temporarily closed in several smaller North Indian cities, including Agra, Chandigarh, Meerut, Mohali, and Amritsar. The company shut down approximately 44 cafes, affecting more than 400 employees. Media reports indicate that Zepto was spending between Rs 250 crore and Rs 300 crore per month toward the end of last year. Meanwhile, the Aadit Palicha-led company is finalising a Rs 1,500 crore (approximately $175 million) structured debt deal with Edelweiss Alternative Asset and other investors. The funds will be used to buy back shares from foreign investors, increasing Indian ownership ahead of the IPO.

Zepto to raise $500 Mn at $7 Bn valuation: Report

EntrackrEntrackr · 17d ago
Zepto to raise $500 Mn at $7 Bn valuation: Report
Medial

Zepto to raise $500 Mn at $7 Bn valuation: Report Quick commerce firm Zepto is in advanced talks to raise $500 million in a new funding round led by existing backers General Catalyst, Avenir, and others, according to a Moneycontrol report. The round is expected to value the Mumbai-based startup at around $7 billion, a significant jump from its previous valuation of $5 billion when it raised $350 million in November 2024. In total, the Aadit Palicha-led company raised $1.35 billion in 2024. This development comes shortly after Zepto postponed its planned initial public offering (IPO) to 2026. The company had already completed its reverse flip to India in January this year. Zepto is currently prioritizing lower cash burn and stronger profitability ahead of its public listing. In response to rising operational costs, the company has temporarily shut down its food service arm, Zepto Cafe, in several smaller North Indian cities such as Agra, Chandigarh, Meerut, Mohali, and Amritsar. Zepto is also facing strong competition from rivals including Blinkit and Swiggy. According to an ICICI Securities report, Blinkit and Swiggy Instamart surged ahead in Q1 FY26, expanding gross order value by over 25% and 22%, respectively. The duo outperformed the overall quick-commerce sector’s sub-20% growth. In April, Palicha said the company is approaching an annualized Gross Order Value (GOV) of $4 billion. According to him, Zepto scaled from $1 billion to $3 billion in GOV within eight months, reflecting around 300% year-on-year growth and a 30% increase since January 2025. Recently, Palicha added that a majority of Zepto's dark stores are expected to become fully EBITDA-positive in the next quarter. Earlier this year, it closed a $665 million Series F round followed by a $340 million top-up, raising over $1 billion in 2024 alone. Zepto claims a majority of its dark stores have turned EBITDA positive, with deeper expansion planned across metros and Tier II/III cities. The upcoming funding is likely to support operational scale, enhance its tech stack, and sharpen its supply chain efficiencies. While earlier reports suggested a delayed IPO timeline, Zepto has clarified it is targeting a late-2025 to early-2026 window, contingent on market conditions. The company is also said to be aligning its cap table to include more domestic investors in preparation for a potential India listing. Founded in 2021, Zepto competes with Blinkit, Swiggy Instamart, and BigBasket in India’s fast-evolving quick commerce space.

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