Zepto, the quick commerce company revolutionizing grocery and essentials delivery, has reached a pivotal milestone by raising $350 million in a funding round led by Indian investors. This development underscores the company’s goal to become a fully Indian-owned entity while staying on track for profitability. Co-founder and CEO Aadit Palicha expressed confidence in Zepto’s potential for an IPO by 2025, emphasizing its trajectory as a globally unmatched quick commerce success story.

Dismissing Misconceptions About Quick Commerce
Palicha addressed concerns regarding the impact of quick commerce on traditional kirana stores, labeling such claims as baseless. He argued that the industry’s net positives, such as significant job creation and wage increases, outweigh any alleged negatives. According to Palicha, Zepto’s delivery model has created lakhs of jobs while maintaining fair pricing.

“99.8% of our products are sold above cost, and allegations of predatory pricing are entirely unfounded. We are open to scrutiny and invite skeptics to review our data,” he asserted.

Innovation Meets Economic Growth
Palicha highlighted India’s unique position in leveraging quick commerce technology at scale. With Indian technology driving infrastructure advancements, Zepto delivers essentials like rice and shampoos within 10 minutes—an unparalleled feat globally.

“This is Indian innovation at its best. While quick commerce is growing, kirana stores and other formats of commerce are thriving too,” Palicha remarked.

The company sees an estimated $200 billion in incremental consumption as a sign of immense growth potential in India’s retail sector.

Commitment to Quality and Transparency
Zepto is focused on aligning its operations with consumer safety standards and working closely with FSSAI to ensure food quality. Palicha views the partnership as an opportunity to improve service quality rather than a regulatory hurdle.

Aiming for Profitability and Expansion
Zepto’s funding round, led by Motilal Oswal’s Private Wealth division, was designed to increase domestic ownership and accelerate growth. By FY26, the company plans to complete its transition to becoming a fully Indian-owned entity.
In terms of profitability, Zepto has significantly reduced the time required for stores to turn profitable—from 23 months to just 8 months. The company expects to be PAT-positive in the next financial year, marking a major milestone in its journey.

Zepto Cafe: A Game-Changer
The success of Zepto Cafe, an extension of the core business, highlights the company’s innovative strategies to increase customer engagement. With projections of reaching ₹1,000 crore in revenue for Zepto Cafe alone, Palicha noted its role in boosting retention and app usage.

“Customers love Zepto Cafe. It has enhanced frequency and retention, driving the core business forward,” he said.

Market Outlook and Competition
Despite competition from Blinkit and Swiggy Instamart, Zepto remains undeterred. Palicha welcomed the challenges, citing the vast growth opportunities within the market.

“We focus on our execution and believe there’s plenty of room for everyone to thrive,” he concluded.

Expansion and Future Goals
Zepto plans to expand to 50+ cities in the next quarter, building on its presence in two dozen cities currently. With a rapidly multiplying top-line performance, the company aims to become one of the fastest-growing consumer brands in India.

Author: Sania Khan