FDA Suspends Zepto’s Dharavi Warehouse Licence For Food Safety Violations

The Food and Drug Administration (FDA) has revoked the food business licence of Zepto parent Kiranakart Technologies’ warehouse in Mumbai’s Dharavi. 

An inspection by FDA officials, carried out on the directions of Maharashtra’s food and drug administration minister Yogesh Kadam, found serious food safety violations at the warehouse.

Violations included storage of edible products near stagnant water, fungal growth on food times and undiscarded expired products, Times of India reported. Additionally, there were eatables stored in damp and unsanitary floors and the cold storage maintained by the facility did not meet the safety standards.

Following the inspection, assistant commissioner of food Anupamaa Patil issued a suspension order under Section 32(3) of the Food Safety and Standards Act, 2006, and Regulation 2.1.8(4) of the Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011.

The licence will remain suspended till the company provides full compliance with the food safety norms and receives clearance from the licensing authority.

Commenting on the development, a Zepto spokesperson said, “At Zepto, maintaining the highest standards of food safety and hygiene is non-negotiable. We have already initiated an internal review and are working closely with the concerned authorities to ensure full and swift compliance.”

“We are taking all necessary corrective measures to resume operations in accordance with regulatory obligations and applicable laws at the earliest,” the spokesperson added.

However, this is not the first time when a quick commerce company has come under the scanner for food safety issues. Last year, the Telangana food safety department raided a warehouse of Blinkit and found it to be “disorganised, unhygienic and dusty”.

Following this, the Food Safety and Standards Authority of India (FSSAI) stepped up visits and surprise checks at dark stores of quick commerce players. 

Where Zepto Stands Amid The Quick Commerce Boom

The development comes at a time when the quick commerce space is seeing intense competition. While the top three players – Blinkit, Instamart and Zepto – are aggressively expanding their dark store network, Flipkart Minutes and BigBasket are also also looking to grab a share in the market. 

Blinkit set up a record 294 new stores in Q4 FY25 and Instamart added 316 dark stores during the quarter. This expansion spree has resulted in rising losses of the quick commerce verticals of Zomato and Blinkit.

While Zepto’s FY25 numbers are not yet out, the startup, which is eyeing a public listing by the end of this year or early-2026, is said to be rationalising its workforce to cut expenses. Recently, Zepto Cafe temporarily shut operations in about 44 small cities, including Agra, Chandigarh, Meerut, Mohali and Amritsar, to address supply chain challenges.

Last month, Zepto cofounder and CEO Aadit Palicha said that the startup’s gross order value surged 220% year-on-year to INR 2,400 Cr in May 2025. He said that Zepto’s “EBITDA has improved by 20 absolute percentage points (2,000 basis points) from January 2025 to May 2025, and is approaching single-digit territory”.

Palicha disclosed these numbers while alleging that the CFO of a competitor company has been running a “smear campaign” against Zepto.

On the business front, Zepto, in May, launched a new data analytics tool, Atom, for brands listed on the platform. Palicha said that the subscription-led offering will enable brands to gain deeper insights on behavioural data, “pincode-by-pincode market share data, and brand performance”.

In FY24, Zepto’s net loss declined 2% to INR 1,248.64 Cr in FY24 from INR 1,271.84 Cr, in the previous year. Operating revenue grew 120% to INR 4,454 Cr during the year under review from INR 2,025.70 Cr in FY23.