The online food delivery and the restaurant detection firm has ended the 2018 financial year with a 40 per cent growth in its revenues at Rs. 466 crores. The firm will also cut down its corners by nearly 73 per cent to come in at Rs. 106 crores in the financial year when compared to Rs. 390 crores the previous year according to the financial documents those were filed with the registrar of the companies and also accessed the data research platform Tofler.
In the financial year 2018, Zomato saw its standalong revenues increase by nearly 25 per cent i.e. to 388 crore rupees from Rs. 309 the previous year. In the month of April 2018, the CEO and the Founder Deepinder Goyal said that the Financial year 2018 was to demonstrate that the business was heading in the direction of profitability as the year was ended with the firm doubling down on the growth and the investments towards the same.
“We demonstrated that our business can generate profits — almost throughout the year, we hit EBITDA breakeven globally, across all our business, and while maintaining good growth levels; and then in the last two months, we decided to double down on growth,” wrote Goyal. The firm also saw its total expenses would increase slightly by 19 per cent to Rs. 370 crores in the 2018 financial year from Rs. 460 crores in the 2017 financial year.
The 2019 Financial year is probably to see the losses and expenses of the firm to rise tremendously as the food tech industry would be engaged in a discount driven battle between Food panda, Swiggy, Zomato and UberEats for grabbing larger mind shares and the wallet shares of the users . The firm also burnt about $6 million of its overall cash burn of $11 million for this financial year in the month of March and February as it started heavy discounts across the markets like Chennai, Hyderabad and Bangalore where the Swiggy leads.
This current financial year even saw that both the founders Pankaj Chaddah and Goyal left the firm this year, garner a significant raise in their salaries as compared to last year. In FY17, Goyal voluntarily gave up his remuneration for the year even as Chaddah took a steep cut from Rs 70 lakhs to Rs 35 lakhs. In FY18, Goyal took home Rs 58 lakhs while Chaddah`s salary rose to Rs 83 lakhs, as per the documents.
Industry sources peg Zomato`s current monthly burn at between $20-22 million even as competitor Swiggy burns about $18 million each month in the race to the top spot in this industry. Zomato serves more than 13 million orders each month whereas Swiggy delivers nearly 19 million orders per month. Zomato, this year saw its online ordering business to contribute nearly 30 per cent of its over all revenue whereas Zomato Gold alone, that presently has 4,00,000 subscribers throughout 14 cities formed nearly 12 per cent of the revenue of the firm.
The firm also focuses on the other businesses thereby leading a slowdown in the growth of its biggest revenue churning advertising that now forms beneath 40 per cent of the long-tern revenue share.
“We had stopped hiring in our ads business as we really wanted to crack the transactions piece as an organisation. The number of people in our ad sales team is down 20% since last year, but our ads revenue for this year still grew 20% y-o-y. About 15,000 restaurants paid us for advertisements in the last year,” Goyal had written in the blog post in April while announcing the unaudited FY18 results.