Zomato has raised its platform fee from ₹6 to ₹10 amid the festive season, according to a notification from its mobile app. The food delivery platform clarified that the fee hike applies to select cities, emphasising that such adjustments are routine and may differ depending on the location, the company states in a BSE filing.
Amid this development, Zomato shares dipped as much as 3.4% to ₹254.80 apiece on the BSE. The stock opened higher today at ₹267.40 against the previous close price of ₹263.85. Over the past month, the stock has dipped 12.58%, while it gained 38.29% in the last six months. On the year-to-date (YTD), the counter surged 104.82%.
At the time of reporting, Zomato shares were trading 3.16% lower at ₹255.50, with a market cap of ₹2,25,497.43 crore.
“We would like to state that this is not a rumour, as the source of information mentioned in the article is the Zomato mobile application itself which is public and available for everyone to see and check. We have indeed increased the platform fee yesterday across certain cities,” the food delivery giant states in a release.
A notification on the app explained that the fee helps cover operational costs and keep the service running smoothly during the busy period.
In August 2023, Zomato introduced a platform fee at ₹2, progressively raising it to ₹3, ₹4, and temporarily to ₹9 last December, before finally settling at ₹10 currently. Following the recent hike, Zomato now charges a fee of ₹10 per order, which applies to all customers, including Gold members. This fee is in addition to other costs like GST, delivery charges, and restaurant fees associated with the order.
In response, Swiggy has also raised its platform fee to ₹10 per order. The Zomato app indicates that this fee increase is temporary. In contrast, Swiggy's fee hike appears to be permanent, as there is no notification regarding this change on its app.
Zomato reported a consolidated net profit of ₹176 crore for the second quarter ending September 30, 2024, marking a significant 389% increase from ₹36 crore in the same period last year. However, despite this year-on-year (YoY) growth, the profit was down 30% compared to the ₹253 crore earned in the previous quarter.
Revenue from operations surged by 68.5% YoY to ₹4,799 crore in Q2, up from ₹2,848 crore a year ago and ₹4,206 crore in the previous quarter. This increase was driven by improved margins in the food delivery segment and the expansion of its quick-commerce business. On the operational side, EBITDA (Earnings, before, interests, taxes, depreciation and amortisation) came in at ₹230 crore, with a margin of 4.7%, an increase of 50 basis points compared to the previous quarter.
Zomato's food delivery business saw over 20% YoY growth in both gross order value (GOV) and revenue, maintaining stable margins. In Q2FY25, the GOV for food delivery reached ₹9,690 crore, marking a 4.6% increase quarter-on-quarter (QoQ) and a 21.4% rise YoY.
