FDA Revokes Suspension Of Zepto’s Dharavi Warehouse Licence

Days after Maharashtra’s food safety regulator, the Food and Drug Administration (FDA) suspended Zepto’s food business licence in Mumbai’s Dharavi area over reasons of non compliance with food safety standards, the quick commerce major today said it has received regulatory clearance to resume operations at the warehouse.

Zepto said in a statement that the suspension was revoked following a detailed re-inspection by the state’s food safety agency and the submission of a compliance report by the company.

“Zepto’s Dharavi store has resumed its operations. Zepto is committed to adhering to all necessary food safety standards prescribed by the Food Safety and Standards Act, 2006 and applicable regulations,” it added.

The appeal filed by the quick commerce giant was heard yesterday (June 13).

The food safety inspection was carried out last week on the directions of Maharashtra’s food and drug administration minister Yogesh Kadam. 

Zepto Private Limited, which operates Zepto, was found violating the Food Safety and Standards Act (2006) and the Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011.

The food safety regulator found fungal growth on certain food products and undiscarded expired products. Additionally, there were eatables stored in damp and unsanitary floors and the cold storage maintained by the facility did not meet the safety standards.

Meanwhile, in another regulatory sweep, the Maharashtra FDA revoked the food business licence of Blinkit’s dark store in Pune’s Balewadi for lapses in food safety and hygiene.

Zepto Defers IPO To 2026

Meanwhile, Zepto has reportedly postponed its IPO plans by a year, now aiming for a listing in the second half of 2026. While there have been no comments from the company on its IPO delay, it appears that it is working on reducing its cash burn.

In April, Zepto renamed its registered entity from Kiranakart Technologies Private Limited to Zepto Private Limited.

Earlier this year, the company also shifted its domicile back to India from Singapore. 

On the financial front, Zepto posted a 2X jump in its consolidated revenue to INR 4,454.52 Cr in the fiscal year ended in March 2024 (FY24). The startup’s operating revenue jumped 120% during the year under review from INR 2,025.70 Cr in FY23. 

However, Zepto could only reduce its cash burn marginally by 2% to INR 1,248.64 Cr in the fiscal under review from INR 1,271.84 Cr in FY23.

The Dark Store, Dark Theory

Quick commerce has managed to create a strong need for quick 10-minute deliveries among the consumers. However, there have been multiple incidents where this quick convenience is pointed out to be a health hazard.

Consumers often complain on social media regarding the hygienic and bad conditions of food products delivered by these quick commerce giants.

Every food business operator in India needs to adhere to the rules and regulations mentioned in the  Regulation 2.1.1(4) of Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations 2011.

Besides, Zepto, Blinkit and Swiggy’s Instamart, along with other quick commerce platforms have faced backlash for their dark patterns.

Users often complain regarding hidden charges and price differentiation. These platforms use algorithms to determine price based on the customers’ location and device. Besides, there have also been complaints regarding these platforms differentiating prices on Android and iPhone.

Last week, the Central Consumer Protection Authority (CCPA) issued an advisory to all ecommerce players to take necessary steps to ensure that their platforms do not engage in deceptive and unfair trade practice. This advisory came on the back of the authority holding a meeting with giants including Amazon, Flipkart, 1mg.com, Apple, BigBasket, Meesho, Meta, Swiggy, Zomato, Yatra, Uber and more.