Highlights
Zepto Transitions Headquarters from Singapore to India
Zepto, a quick commerce platform, has successfully completed its transition from Singapore to India, as confirmed by the company’s Chief Financial Officer, Ramesh Bafna. This change, known as a reverse flip, allows the Mumbai-based company to establish its main office in India and begins the steps towards an initial public offering (IPO), which has been in preparation for several months.
This announcement follows the recent approval obtained from the National Company Law Tribunal (NCLT) for their reverse merger. In line with media reports, Zepto is seeking to raise between $400 million and $500 million through its IPO and has appointed Goldman Sachs, Morgan Stanley, and Axis Capital as its underwriters.
Bafna remarked on LinkedIn that the company has achieved a significant milestone in completing the India-focused reverse merger in an exceptionally swift timeline. He highlighted that this success reflects an adept understanding of technical processes, collaboration with the right partners, and effective execution and decision-making by a motivated team.
Industry Comparisons
With this strategic move, Zepto joins other notable companies such as Groww and PhonePe, who also relocated their bases from the US and Singapore, respectively. Several fintech firms, including Flipkart, KreditBee, Pine Labs, and Razorpay, have undertaken similar reverse flips. Pine Labs has already received final permission from Singaporean courts to change its headquarters to India.
Tax Implications and Financial Overview
Zepto has yet to disclose the tax implications of its reverse flip. For reference, PhonePe incurred a tax of Rs 8,000 crore, while Groww’s tax amounted to Rs 1,340 crore to facilitate this process. The total tax liability is contingent on the company’s valuation and the results of third-party audits.
Recently, Zepto secured $350 million in a funding round led by Motilal Oswal Private Wealth, achieving a valuation of $5 billion. The company also raised an additional $1.35 billion in 2024, bringing its cumulative funding to $1.85 billion since its formation.
Financial Performance
In the fiscal year ending March 2024, Zepto reported a 2.2 times increase in revenue from operations, reaching Rs 4,454 crore compared to Rs 2,026 crore in FY23. During this same timeframe, its losses saw a modest reduction of 2%, totalling Rs 1,248.6 crore.
