Zepto pauses IPO plans, eyes ₹1,000 crore pre-IPO fundraise from existing investors
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Quick-commerce unicorn Zepto has put its initial public offering (IPO) plans on hold and is preparing to raise around ₹1,000 crore in a pre-IPO funding round from primarily existing and domestic investors, industry sources told Fortune India.
The fundraising is expected to value the company at about $4.5 billion, significantly below the $7 billion valuation at which it secured $450 million from investors, including the California Public Employees' Retirement System (CalPERS), in its last funding round in October 2025.
According to sources, the fresh capital will largely come from domestic investors as the company seeks to increase Indian ownership ahead of its eventual public listing. Indian shareholders currently own about 40% of Zepto.
The company's IPO, which was earlier expected around July 2026, has been deferred for the time being, the sources added. Zepto did not respond to an email seeking comment.
Founded by Aadit Palicha and Kaivalya Vohra, Zepto confidentially filed its draft IPO papers with the Securities and Exchange Board of India (Sebi) in December 2025 under the regulator's pre-filing norm.
The draft red herring prospectus (DRHP) proposes a fresh issue of ₹8,010 crore. The company plans to deploy about 45% of the proceeds to expand its network of dark stores and meet lease-related expenses. Another 25% has been earmarked for technology investments, cloud infrastructure and marketing initiatives, while the remaining 30% is intended for acquisitions and general corporate purposes.
The IPO preparations gathered pace after shareholders approved the public issue proposal at an extraordinary general meeting in December 2025. Zepto has also converted itself into a public limited company as part of the listing process.
Founded in 2021, the Bengaluru-based startup has become one of India's largest quick-commerce platforms by focusing on ultra-fast grocery deliveries through a dense network of dark stores.
Despite its rapid growth, analysts believe profitability remains a key challenge. A recent report by Emkay Global said Zepto has successfully built a scaled quick-commerce business but faces a steeper path to profitability than rival Swiggy Instamart.
The brokerage noted that Zepto's everyday low-price strategy and relatively low minimum order value have helped it acquire customers rapidly. However, increasing average order values to improve margins could weigh on order growth.
According to Emkay, Zepto is currently India's second-largest quick-commerce player. Its FY26 net order value exceeded Swiggy Instamart's by 13% but remained 53% lower than Blinkit's. The company also recorded the highest daily order density in the industry, averaging 2,117 orders per store in the fourth quarter of FY26, compared with 1,425 for Blinkit and 1,098 for Swiggy Instamart.
At the same time, Zepto continues to report the largest operating losses among major quick-commerce companies. Its adjusted EBITDA loss stood at ₹5,360 crore in FY26, compared with ₹3,510 crore for Swiggy and ₹280 crore for Blinkit. According to Emkay, Zepto's lower average order value has been one of the key factors behind its wider losses.