Zepto in talks for $300 Million funding, eyes valuation jump to $3 Billion

April 2, 2024

In the midst of the increasingly fierce competition in the quick commerce arena, Zepto is reportedly in early-stage discussions to secure a minimum of $300 million from global investors, according to sources cited by ET.

The Mumbai-based startup could potentially achieve a valuation of at least $2.5-3 billion based on current market metrics, sources familiar with the conversations suggest. This marks a significant increase from its previous valuation of $1.4 billion when it attained unicorn status last year.

As per insights gathered from recent investor presentations, Zepto is striving to attain EBITDA positivity by September. It’s reported that the company presently boasts an annualized gross sales run-rate of $1.2 billion.

Although still in its initial phases, the upcoming fundraising initiatives are poised to fortify the company’s financial position while simultaneously establishing a substantial reserve for confronting market leader Zomato-owned Blinkit and Swiggy Instamart. Additionally, Walmart-owned Flipkart is gearing up to venture into quick commerce within the next two months.

Continue Exploring: Quick commerce unicorn Zepto raises $31.25 million in Series E funding, supported by Goodwater Capital and Nexus Venture Partners

“We are negotiating with international investors, such as sovereign wealth funds”. A person with knowledge of the matter has stated that a board meeting later this month will address the new fundraising plan and its parameters.

Zepto, having achieved a $1 billion gross sale run rate last month, is actively scaling its operations and has ambitious ecommerce strategies in place. Despite receiving a term sheet from at least one growth stage fund recently, the company has decided not to proceed with it.

“Zepto wants to move up the timeline to reach the positive Ebitda mark by a few months. That will improve its situation going into the next round. A group of investors who have forward-looking plans on key metrics have been given access to the company’s financials, according to a source.

“They (Zepto) have ambitious plans for a total rise and are undoubtedly considering a new round. According to someone with knowledge of the dynamics, the company appears to have increased its market share in some of the nation’s most competitive cities, accounting for the majority of the growth in rapid commerce.

Based on financial records, Zepto operates about 340 dark stores, more than 200 of which have positive Ebitda. While Swiggy Instamart has more than 500 dark stores in comparable places, Blinkit has more than 450 dark stores spread over 25 cities.

Aadit Palicha, co-founder and CEO of Zepto, stated that the company is currently not engaged in active fundraising efforts, and there are no ongoing discussions with investors.

“Strong execution, not capital raising, is the objective at the moment because we are about to be Ebitda positive after closing a sizable round a few months ago,” he continued.

Our mature stores currently make up 6-7% of Ebitda, with the potential to reach 13-14%. We are increasing at a rate of 140% annually. Palicha commented on company expansion, “so these stores are able to generate their own cash.”

He mentioned that Zepto has expanded its business by more than 100% since its previous fundraising round in October, with Ebitda showing a 600 basis points improvement.

Last month, Zomato CEO Deepinder Goyal remarked that Blinkit has the potential to surpass food delivery and emerge as a larger business. This highlights the long-term prospects of Blinkit. As a market leader in major metropolitan areas, Blinkit is broadening its range of stock keeping units (SKUs) to include fashion, jewellery, toys, beauty products, and electronics. Similarly, Zepto is also expanding its offerings within these categories.

Continue Exploring: Quick commerce platforms Blinkit and Zepto expand into e-commerce, targeting fashion, beauty, electronics, and more

Over the past year, Zomato has invested approximately $240 million in Blinkit. Blinkit has achieved a gross merchandise value (GMV) of more than $1 billion in the first nine months of fiscal year 2024. Zomato holds nearly $1.5 billion in cash reserves.

A senior ecommerce executive who is keeping tabs on the growth of quick commerce platforms stated, “These players will need financial resources to scale up the infrastructure for an ecommerce play which is linked to the funding talks.”

Swiggy has directed its capital investment towards Instamart, as its food delivery business has reached a point of stability in terms of investment requirements. The company earmarked a $700 million investment for Instamart.

Swiggy has been focused on bolstering its financial position in anticipation of a potential IPO later this year. According to a Reuters report, the company recorded a loss of $200 million for the first nine months of 2023, with revenue totaling $1.02 billion. Blinkit is projected to achieve break-even in the first quarter of fiscal year 2025, as per earlier guidance provided by Zomato.

Continue Exploring: Blinkit to outgrow Zomato within a year, says CEO Deepinder Goyal

Zomato pilots new last-mile delivery service for office goers in corporate parks

SnackTeam

April 2, 2024

Zomato, a leading player in the foodtech space, is reportedly piloting a new initiative that offers last-mile delivery to office goers within corporate parks.

According to Entrackr, Zomato has established kiosks at “approximately five to six” corporate parks in Gurugram. At these kiosks, a delivery executive hands off the food parcel to the stationed team. Following this, a designated “walker” is assigned to deliver the item to the customer’s specific floor or location.

According to the report, Zomato has likely joined forces with corporate parks to “whitelist” these last-mile delivery providers. Furthermore, the foodtech company has promised “no calls from delivery partners” to customers and has assigned specific “walkers” to each floor.

The company chose not to respond to inquiries regarding the matter.

Continue Exploring: Zomato launches in-hall food delivery service at PVR Cinemas in Gurgaon, enhancing movie-goers’ experience

“The initiative is presently in an experimental stage, and based on the pilot’s results, the organisation plans to expand this offering to the top five cities,” according to a source mentioned in the report.

Meanwhile, according to another individual familiar with the situation, these kiosks are reportedly processing approximately 100 to 150 orders daily, with the company anticipating a rise in this figure in the coming days.

With this initiative, Zomato aims to adopt a model similar to that seen in China, where companies like Meituan station their teams at areas housing corporations and startups to streamline deliveries.

This development comes at a time when Zomato has been experimenting with a range of new offerings to bolster its revenue. Last year, the company introduced a platform fee (which now ranges from INR 3-5) and followed this by partnering with the Indian Railway Catering and Tourism Corporation (IRCTC) to deliver pre-ordered meals to railway passengers.

In February, reports suggested that the foodtech company was considering expanding its quick commerce division, Blinkit, by incorporating more brands across different categories to compete with ecommerce giants like Amazon and Flipkart.

Meanwhile, the company maintains strong financial performance, with its third consecutive profitable quarter reported in Q3 FY24. Its net profit surged fourfold sequentially to INR 138 Cr in Q3 FY24, while operating revenue increased by 15% quarter-on-quarter to INR 3,288 Cr.

Continue Exploring: Zomato reports third consecutive profitable quarter with INR 138 Cr PAT in Q3 FY24

It has also gained favor among investors, with Jefferies including the stock in its “top picks” list for the next five years.

On Monday (April 1), Zomato’s shares concluded 1.21% higher at INR 184.55 on the BSE.

Continue Exploring: Zomato among Jefferies’ top picks for next five years, anticipates 2.5X share price increase by 2029

Reliance Brands unveils new Superdry store in Bengaluru, promising fashion enthusiasts a fresh retail experience

SnackTeam

April 1, 2024

Superdry, the British apparel brand, has launched its latest store in Bengaluru, as announced by a company official on social media. Located at Phoenix Marketcity, Whitefield, the new store promises a fresh shopping experience for fashion enthusiasts.

“I’m absolutely ecstatic to announce the opening of our newest Superdry store at Phoenix Marketcity, Bengaluru. This store is truly exceptional and represents the pinnacle of our commitment to delivering top-notch consumer experiences,” shared Rakesh Ranjan, Vice President of Superdry India, on LinkedIn.

The store provides a wide range of outerwear, t-shirts, and shirts for both men and women, as well as categories such as swimwear, footwear, fragrances, and accessories.

Since 2012, Reliance Brands Ltd (RBL) has served as Superdry’s exclusive franchise partner in India through its wholly-owned subsidiary in the UK (RBUK). The brand has experienced rapid expansion, with over 200 points of sale established across more than 50 cities.

Continue Exploring: Fashion brand Snitch achieves over 150% growth in FY23-24, marks highest GMV in March

Furthermore, e-commerce remains a key driver of growth for the brand, extending its reach to over 2,300 cities across India.

RBL has recently finalized an agreement to form a joint venture with Superdry PLC. As part of this agreement, Superdry PLC will transfer its intellectual property assets for the territories of India, Sri Lanka, and Bangladesh. Reliance will maintain its role in managing brand operations within these three countries.

RBL, the premium retail division of RRVL, manages a vast network of over 18,000 stores throughout India. Offering a diverse range of 50 luxury fashion brands, RBL has established its presence in 7,000 towns, covering a total shopping area of more than 65 million square feet.

Continue Exploring: Superdry CEO Julian Dunkerton weighs takeover options as struggling retailer seeks recovery

Bombay Shaving Company secures INR 24 Crore in debt financing from Alteria Capital to fuel growth

SnackTeam

April 1, 2024

Shantanu Deshpande, Founder and CEO of Bombay Shaving Company

Bombay Shaving Company, a direct-to-consumer grooming and personal care startup, has secured INR 24 crore ($3 million) in debt financing from venture debt fund Alteria Capital.

Shantanu Deshpande, the founder and CEO of Bombay Shaving Company, stated that the funding will support the startup in its next phase of growth.

Deshpande mentioned, “We anticipate approximately 35% growth in FY25. It is crucial at this point to enhance the brand’s visibility through investments in brand campaigns, particularly for our core power products.”

This funding comes two years after Bombay Shaving Company raised INR 160 crore in its Series C round from investors such as hedge fund Malabar Investments, Gulf Islamic Investments, and Singularity AMC. The startup is currently in talks about raising equity funding for its Series D round.

Continue Exploring: D2C men’s fashion brand Snitch hits INR 400 Crore GMV milestone, targets INR 600 Crore by 2024

Established in 2016 by Deshpande, Bombay Shaving Company began as a direct-to-consumer brand specializing in men’s shaving and grooming products. Over time, the company diversified into additional categories, including women’s grooming, and evolved into an omnichannel brand.

The startup’s range of products can be found on numerous ecommerce platforms such as Nykaa, Flipkart, and Amazon, as well as in over 40,000 retail outlets. Bombay Shaving Company asserts its clientele spans across India, the US, Europe, the Middle East, Australia, and New Zealand.

Deshpande stated that the new funding will be deployed to improve the startup’s go-to-market strategy in the razor category, which is its current primary focus. Furthermore, the company plans to develop new products and innovations.

Deshpande continued, “We also want to increase our offline (channel) exploration and go from our current 12 cities to 25 cities.”

Meanwhile, Ankit Agarwal, managing partner at Alteria Capital, stated that Bombay Shaving Company has revolutionized the grooming and personal care sector, which has long been dominated by established brands, through its innovative approach.

According to him, Bombay Shaving Company has not only disrupted the status quo but also established itself as a top brand that consumers choose in this competitive market by changing product formulas, creating new subcategories, and implementing cutting-edge distribution methods.

The venture debt fund invested in the startup from both its second and third funds.

It’s worth noting that Alteria Capital announced the final closing of its third venture debt fund at INR 1,550 Cr last week. From this fund, they have already invested in startups such as Renee Cosmetics, One Card, Bliss Club, Rebel Foods, Giva, Kissht, Traya, Bluestone, and Ather.

Continue Exploring: D2C skincare brand Foxtale secures $14 Million in funding led by Panthera Growth Partners

Overall, Deshpande-led Bombay Shaving Company has amassed a total funding of about $48 million to date.

Although it has not yet filed its FY23 financials, Deshpande mentioned that the startup generated approximately INR 178 crore in revenue during FY23, accompanied by a negative 37% EBITDA. In FY22, it recorded an operating revenue of INR 99.93 crore, but experienced a nearly threefold increase in net loss year-on-year, reaching INR 42.92 crore.

In the realm of men’s grooming, Bombay Shaving Company vies for market share against competitors such as The Man Company, Ustraa, and Beardo.

Premiumization trend boosting growth in food chains like KFC, McDonald’s, and Popeyes: ICICI Securities Report

SnackTeam

April 1, 2024

As competition grows fiercer and consumers dine out more frequently, the trend towards premiumizing food items is fueling the expansion of food chains.

An ICICI Securities research report suggests that various brands are now catering to diverse price points and target audiences.

Brands are embracing premiumization with innovative offerings like KFC‘s Chizza (a pizza-chicken hybrid); Domino’s Oven Baked Pasta and Burger Pizza (a distinctive fusion); and Popeyes‘ introduction of The Cajun flavor (a pioneering move).

Biggies Burger, BurgerMan, and several other brands compete fiercely with national brands in the chicken market. Fried chicken is emerging as a competitive advantage, with each player, organised or not, offering competitive pricing based on taste.

Oven Baked Pasta in PH and Burger Pizza in Domino’s make a unique combination. Indigenous brands, for instance Biggies Burger and BurgerMan, compete aggressively with national businesses in the chicken category.

Continue Exploring: Domino’s Pizza takes on upscale pizzerias in India with premium offerings and hyper-localized approach

According to a report from ICICI Securities, “Organised players such as KFC, McDonald’s, Popeyes, and Burger King are aiming to increase their market share through network expansion, benefiting from the rising disposable income of GenZ and working millennials, as well as an improved start-up ecosystem.”

Brands are enticing consumers through pricing tactics and fresh product introductions. KFC’s launch of its Lunch Special Combo at INR 149 from 11 AM to 4 PM has bolstered foot traffic and increased customer engagement.

The Chizza, priced at INR 300, has been a significant success for KFC stores, accounting for 8-10% of its daily sales. KFC outlets experience increased footfall on Wednesdays, Saturdays, and Sundays.

Continue Exploring: Chizza fever hits U.S. as KFC announces debut of unique pizza-inspired dish

The brand generates 85% of its revenue from non-vegetarian items and 15% from vegetarian offerings. Pizza Hut introduced “Melts,” a distinctive thin-crust pizza starting at Rs. 169, which is receiving positive feedback in the market.

It’s “Don’t Cook Wednesday” promotion offers a 50% discount on any medium pizza. Quick Service Restaurant (QSR) brands are promoting mid-week dining out as an alternative to weekend dining, driving their growth.

Popeyes, during its early launch phase, encountered difficulties in establishing its product positioning vis-à-vis KFC and McDonald’s. The brand found itself competing in the fried chicken space, where KFC held a prominent market leadership position.

While KFC maintains its practice of locally sourcing chicken and marinating it in-store for two hours, Popeyes sets itself apart with a 12-hour marination process conducted at its commissary in Bengaluru.

Consumers are also intrigued by the Cajun flavor, distinguishing it from the Indian spices offered by competitors. McDonald’s success with its Peri Peri flavor as a French fry topping demonstrates growth driven by premiumization.

Continue Exploring: Jubilant FoodWorks bets big on Popeyes, targets INR 1,000 Crore revenue in the next five years

The market is fiercely competitive, with local players vying for dominance on price points. Brands are closely competing by offering attractive combos and deals to entice customers.

The IPL serves as an additional growth catalyst aimed at further increasing the ticket size this quarter, particularly as consumers show a preference for ordering meals at home.

Overall, brands are benefiting from attractive combos, discounts like lunch combos, and new product launches with unique flavors, resulting in improved consumer confidence and rising growth.

Bootstrapped ethnic fashion brand Libas surpasses INR 500 Crore revenue milestone in FY24; eyes 60-70% growth and seeks first round of funding

SnackTeam

April 1, 2024

Libas

Libas, a bootstrapped ethnic fashion brand, has surpassed the INR 500 crore milestone in revenues for FY24. Eyeing a continued growth trajectory of 60-70% in the coming fiscal year, the brand remains dedicated to fortifying its offline channel presence. Furthermore, it has initiated discussions with investors to secure its first round of funding.

“We experienced a growth of 60-70% in FY24, primarily driven by our channel expansion. By opening additional stores and shop-in-shops, we achieved this significant company-level growth. In FY24, we surpassed the INR 500 crore revenue milestone for the first time in the brand’s history,” shared Sidhant Keshwani, Founder & CEO of Libas.

Alongside the introduction of its spring-summer collection, the ethnicwear brand has enlisted actor Kiara Advani as its brand ambassador. Kiara Advani is showcased in the company’s latest brand film, adding a fresh dimension to its promotional efforts.

“With the introduction of our new spring-summer collection, we hold a positive outlook for this fiscal year. We anticipate maintaining growth rates of 50-60%,” added Keshwani.

Addressing concerns about the subdued demand trends in the apparel sector, Keshwani noted that non-essential categories, such as apparel, have experienced a slowdown in demand within the mass market segments. However, the premium and luxury segments continue to perform strongly.

“These subdued demand trends have been evident throughout the past fiscal year. We’ve also observed a slowdown in like-to-like growth levels. However, we anticipate the industry to start recovering from June,” he added.

Continue Exploring: Ethnic wear brand Kalki charts course for global expansion & personalized tailoring

The ethnic wear brand has intensified its offline presence, expanding to more than 15 exclusive brand outlets and over 500 shop-in-shop locations within multi-brand outlets.

“We primarily operate as an online-first brand, but the offline channel will significantly contribute to our journey this year. We aim to open an additional 15 exclusive brand outlets this year,” he commented.

Libas is also preparing to secure its first round of funding. “We have initiated discussions and are considering a minority stake divestment,” Keshwani elaborated.

This comes at a time when the brand is planning to accelerate its offline store expansion.

Continue Exploring: Soch brings ethnic fashion to new heights with its largest outlet in Bangalore

ABFRL’s Style Up continues expansion with new Hyderabad store, reaching 27 locations nationwide

SnackTeam

April 1, 2024

Style Up, a fashion brand under Aditya Birla Fashion and Retail Limited (ABFRL), has launched a new store in Hyderabad, as announced by a company official on social media. This new outlet marks the brand’s sixth location in the city and its 27th store nationwide.

“Incredible way to conclude this fiscal year and reunite with my Champions once again… another fashion destination now graces the city of Hyderabad. Two openings within a week,” stated Rakesh Pant, Chief Operating Officer of Style Up & Marigold Lane at ABFRL, in a LinkedIn post. “Delighted to announce the launch of our 6th Style Up store at Fairmount Fortune One, Czech Colony, Sanath Nagar, Hyderabad today… #27&Counting.”

Style Up showcases a diverse collection of retail brands from ABFRL, including Louis Philippe, Allen Solly, Peter England, Van Heusen, and more. According to information from its website, the brand has a presence in West Bengal, Madhya Pradesh, Maharashtra, Bihar, Telangana, Gujarat, Karnataka, Andhra Pradesh, and Tamil Nadu.

With a history spanning over three decades, ABFRL’s brand lineup features renowned names such as Louis Phillippe, Van Heusen, Allen Solly, Peter England, Reebok, Pantaloons, Style Up, Tasva, Masaba, and more.

At the time of writing, its shares were trading at INR 211.25, reflecting a 2.75% increase.

Continue Exploring: Landmark Group’s Lifestyle unveils first store in Aurangabad, expanding Western region portfolio to 24 outlets

After securing USFDA registration, Wardwizard Foods and Beverages set to enter US market with authentic Indian delicacies

SnackTeam

April 1, 2024

Wardwizard Foods and Beverages Limited is set to make its mark in the US market, following the acquisition of USFDA registration. This notable accomplishment represents a pivotal step in the company’s global growth strategy and reaffirms its dedication to providing top-quality food products worldwide. Wardwizard Foods and Beverages Limited’s product range will now include a diverse selection of RTE (Ready-To-Eat) meals, frozen items, spices, sauces, condiments, and beverages.

With effect from the first quarter of the next financial year 24–25, Wardwizard Foods and Beverages Limited will start exporting to the US. The first phase will concentrate on major cities where customers can enjoy the rich and genuine flavours of Indian cuisine, such as Chicago, New Jersey, and Texas. From easy RTE (Ready-To-Eat) meals to delicious frozen goods, savoury sauces, fragrant spices, adaptable condiments, and cool drinks, the company’s wide selection is carefully crafted to satisfy every palate.

Continue Exploring: Wardwizard Foods and Beverages launches exciting WOL Energy Drink in partnership with Tennis Premier League

Sheetal Bhalerao, Chairperson and Managing Director of Wardwizard Foods and Beverages Limited, shared her immense excitement about this important milestone, stating, “We are truly thrilled to begin this exciting journey of exporting our products to the USA, a market known for its discerning palate and high standards. This achievement highlights our unwavering commitment to bringing the authentic flavors of India to consumers globally. Securing USFDA registration serves as a proud testament to our dedication to product quality and regulatory compliance. This certification not only reaffirms the exceptional quality of our products but also emphasizes our rigorous adherence to strict food safety standards, inspiring unwavering confidence among consumers and stakeholders alike.”

As a key component of the company’s carefully designed market expansion strategy, Wardwizard Foods and Beverages Limited has formed strategic partnerships to guarantee smooth delivery of its products to American consumers. The company’s introduction to the US market presents a substantial growth opportunity and demonstrates its commitment to satisfying the changing demands of discerning consumers globally.

Wardwizard Foods and Beverages Limited offers a range of RTE and Frozen products that are free from preservatives, MSG, and artificial food colors, ensuring a wholesome and authentic culinary experience for consumers. With a focus on retail distribution and private labeling, the company is committed to delivering unparalleled quality and taste to the US market and beyond.

Continue Exploring: SATS launches cutting-edge RTE food facility in Bengaluru as ready-to-eat market booms in India

DS Group taps Atom Network as creative partners for dairy business

SnackTeam

April 1, 2024

The Dharampal Satyapal Group (DS Group), a diversified corporation and prominent FMCG conglomerate, has selected Atom Network as its creative partner for the dairy business.

DS Group is set to make a mark in the dairy industry with its brands, Ksheer and Ovino. The company announced that Atom Network will handle the creative responsibilities for these brands, emphasizing innovative ideas and experiences to enhance their market presence, as per a company press release.

Continue Exploring: DS Group unveils India’s first exclusive Läderach chocolate store in New Delhi’s DLF Emporio Mall

It further stated that Atom Network secured the business following a rigorous competitive pitching process.

Rajeev Jain, Senior Vice President of Corporate Marketing at DS Group, welcomed the new agency, stating, “Atom Network effectively addressed our objectives with their strategic and creative approach, combining industry insights with local cultural relevance, which is crucial for our markets. We are eager to start collaborating.”

Continue Exploring:: DS Group and Laderach place big bets on India’s expanding luxury market, unveil cold chain investment

Abhik Santara, CEO of Atom Network, expressed enthusiasm about the appointment, stating, “We are pleased to collaborate with the DS Group. It presents a fantastic opportunity for us to deliver innovative work for Ksheer and Ovino. We aim to leverage our expertise in FMCG branding to build enduring brand equity for both brands.”

Continue Exploring:: DS Group brings Italian luxury to India with first Brioni boutique in Delhi

D2C menswear brand XYXX launches first-ever ESOP buyback program for employees

SnackTeam

April 1, 2024

XYXX, the D2C menswear brand, announced on Monday its first Employee Stock Ownership Plan (ESOP) buyback program.

The Amazon-backed startup stated that it had initiated the ESOP program in 2020 for eligible employees, who can now sell their stocks at a premium of 6 times with no strike price.

Notably, senior managers, department heads, and executive leadership are included in the pool of qualified employees. The average age of the buyback-eligible employees is thirty-six.

XYXX’s founder and CEO, Yogesh Kabra, expressed, “The announcement of our first ESOP buyback is a moment of pride for the leadership team, particularly for me. It reinforces my confidence in the collective success of Team XYXX and their indispensable role in our journey of growth. As a modern consumer brand startup, we stand alongside top fintech, ed-tech, and e-commerce brands in offering wealth creation opportunities for our workforce.”

Continue Exploring: Men’s innerwear brand XYXX eyes 50-70% growth, diversifies into Athleisure

Established in 2017 by Kabra, XYXX is a D2C menswear brand offering a range of products including underwear, loungewear, and athleisure.

The startup reported a growth rate of 100% CAGR and recorded a revenue of INR 57 Cr in FY22. It anticipates leveraging the expanding Indian innerwear market to drive its future growth. In this sector, it competes with D2C startups like DaMensch and Almo.

The startup has not disclosed the size of its first ESOP buyback plan. According to its LinkedIn profile, the company has a team of 259 employees.

Continue Exploring: D2C innerwear brand Bummer raises INR 9.25 Crore led by Gruhas Consumer Fund

With this move, XYXX joins the growing number of startups launching ESOP buyback plans this year. Today, the audio series platform PocketFM also announced its first ESOP buyback worth $8.3 Mn. Notable companies like CRED, MyGate, Meesho, and others have also unveiled similar plans this year.

According to a survey, approximately 80% of over 400 Indian startup founders surveyed believe that potential employees may be reluctant to join startups following a series of mass layoffs. The report also revealed that 55% of startups are relying on ESOPs to attract the Indian workforce back to the startup ecosystem.

Continue Exploring: Meesho announces its largest ever ESOP buyback, allocating INR 200 Cr for employees

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