Zappfresh IPO Subscribed 94% On Day 5; Retail Interest Remains Weak

After extending its IPO on September 30, Zappfresh’s public offering is yet to sail through on day five. As per Chittorgarh data, the issue was subscribed 94% at the end of October 3.

Qualified institutional buyers (QIBs) showed the strongest appetite for the company’s public offering, oversubscribing their quota 1.45X. These investors bid for 16.16 Lakh shares against the 11.16 Lakh shares reserved for them.

Meanwhile, non-institutional investors (NIIs) also oversubscribed their quota 1.25X, bidding for 10.50 Lakh shares against the 8.39 Lakh shares earmarked for them.

However, muted interest from retail investors dragged the overall subscription down as of Day 5. Retail investors bid for only 9.96 Lakh shares against the 19.54 Lakh shares reserved for them, leading to a 51% subscription.

The BSE SME IPO will remain open for subscription till Monday (October 60), having been extended from its original closing date of September 30 after weak investor interest. At the time, the offering had seen a subscription of just 52%, with investors bidding for 22.44 Lakh shares against the 42.39 Lakh shares on offer.

As a result, the meat delivery company extended the IPO and revised its price band to INR 95–100 from INR 96–101. At the upper end of the revised band, the company now aims to raise about INR 59 Cr from the public float at a valuation of around INR 223 Cr.

Ahead of the issue opening, Zappfresh raised INR 16.8 Cr from 11 anchor investors by issuing 16.7 Lakh shares at INR 101 each. Among them, Craft Emerging Market Fund took the largest share with an investment of over INR 4 Cr, while Viney Growth Fund and Narnolia India Opportunity Fund picked up INR 2.5 Cr and INR 2 Cr worth of shares, respectively.

The IPO proceeds are earmarked for expansion. The company plans to allocate INR 25 Cr for working capital, INR 15 Cr for marketing, INR 11 Cr for capex, and around INR 10 Cr for setting up six cold storage units across Delhi, Mumbai, and Odisha. A smaller portion of INR 3 Cr is set aside for acquisitions.

Founded in 2015 by ex-Licious cofounder Deepanshu Manchanda, Zappfresh sources fresh meat directly from farms and delivers within 90 minutes in cities like Delhi, Bengaluru, and Mumbai. It has expanded through organic growth and acquisitions, including Dr. Meat in Bengaluru and Bonsaro in Mumbai.

On the financial front, Zappfresh has shown steady improvement. Its profit after tax nearly doubled to INR 9.1 Cr in FY25 from INR 4.7 Cr in FY24, while operating revenue jumped 45% year-on-year to INR 130.7 Cr. Growth was driven largely by the B2B segment, which rose over sixfold to INR 36.6 Cr, while the B2C business contributed INR 94 Cr.