Zomato’s IPO: all you need to know.

Are you also a fintech and investment like rookie like most of Gen Z who is not in business school? But I am sure you have also heard about Elon Musk’s newest escapades with crypto currency, and are in touch with all the ongoing events in the world of finance, thanks to the internet. If so, you must have heard about Zomato’s newest achievement, their IPO. If your concern is being aware of Zomato’s newest feat, you have come to the right page. Zomato’s IPO, all you need to know-

What is an IPO?

An initial public offering (IPO) refers to the process of offering shares of a private corporation to the public in a new stock issuance. Public share issuance allows a company to raise capital from public investors. So what Zomato is basically doing is opening its shares to institutional or established and non institutional investors as well. This is a great opportunity and a very big step for Zomato. Companies hire investment banks to market, gauge demand, and set the IPO price and date, and more. It is also a way for the early investors to bid goodbye and move on to newer ventures.

This is in a way a huge gamble yet a very proud moment for Zomato. It is one of the first restaurant and food chain delivery internet companies that has opened bid for their shares. A remarkable achievement, considering Swiggy and Zomato are head to head competitors in this same business. Zomato plans to use these proceeds in organic and inorganic financial initiatives, as per their red herring prospectus.

A red herring prospectus, as a first or preliminary prospectus, is a document submitted by a company as part of a public offering of securities. In layman terms, it is basically to give an idea about what the investors are getting into. A final prospectus always sets up the final tone of the exchange. Post-IPO, the valuation of Zomato is expected to be more than the combined market capitalization of five listed fast food and restaurant companies-Jubilant FoodWorks Ltd, Burger King India Ltd, Westlife Development Ltd, Barbeque-Nation Hospitality, and Specialty Restaurants.

If this is not a big event for budding start up geeks out there, I do not know what is.