Goldman Sachs said in a report late Thursday that Indian food delivery giant Zomato’s quick commerce arm Blinkit is now more valuable than its c

Zomato’s quick commerce unit Blinkit eclipses core food business in value, says Goldman Sachs

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2024-04-26 07:30:07

Goldman Sachs said in a report late Thursday that Indian food delivery giant Zomato’s quick commerce arm Blinkit is now more valuable than its core food delivery business, as per the bank’s sum-of-the-parts analysis.

The investment bank estimates Blinkit’s implied value at 119 Indian rupees per share ($1.43) or about $13 billion, while Zomato’s food delivery business is valued at Rs 98 per share. Goldman previously pegged Blinkit’s valuation at $2 billion in March 2023.

Blinkit’s valuation surge is driven by its strong growth potential in India’s fast-growing quick commerce market. Goldman Sachs forecasts Blinkit’s gross order value (GOV) to grow at a compound annual growth rate (CAGR) of 53% between the financial years 2024 and 2027, outpacing the overall online grocery market’s projected CAGR of 38% during the same period.

The investment bank believes that India’s quick commerce market is poised for growth due to several factors, including a large unorganized grocery sector, high population density in urban areas, and a favorable ratio of delivery costs to average order values. These dynamics have allowed Blinkit to offer competitive prices and fast delivery times, driving customer adoption.