Shares of food-delivery giant Zomato dived on Friday’s early trade, going down by over 3%, after the company announced plans to raise funds through a qualified institutional placement.

What Happened: Zomato’s board of directors will meet on October 22 to approve the firm’s quarterly financial results, the company said in a statement on Thursday. The board will also consider and approve the raising of funds by issuance of equity shares by way of qualified institutions placement, the company added.

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If approved, this will mark the first fundraising effort by the Gurugram-based food delivery giant since its stock market launch three years ago. The potential QIP comes at a time when the company is seeing increased competition from Swiggy ahead of its stock market debut.

Earnings Outlook: Motilal Oswal expects the company to report a 68% rise in its revenue to ₹4,786 crore, adjusted profit is expected to see a multifold rise to ₹142.6 crore.

Overall, sequential growth is expected to remain robust in the second quarter and margins are estimated to remain flat. For its quick commerce vertical Blinkit, the brokerage sees growth momentum continuing in Q2FY25.

Axis Securities expects a revenue growth of 4.2% to ₹4,384 crore, due to strong volume growth. It expects profit to stand at around ₹265 crore. Both brokerages believe that investors should look out for the company’s commentary on its growth outlook and Blinkit vertical.

Price Action: Zomato was trading 1.79% lower at ₹265.70 on Friday morning.

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