Zomato CEO Deepinder Goyal To Not Take Salary Till FY26

Zomato founder and CEO Deepinder Goyal will not take his base salary of INR 3.5 Cr per annum till March 31, 2026, the foodtech major’s filing for its INR 8,500 Cr qualified institutional placement (QIP) showed. 

Goyal hasn’t taken the base salary since April 1, 2021.

“… vide letters dated March 24, 2021 and April 1, 2024, addressed to our board, Deepinder Goyal has voluntarily waived his salary for a period starting from April 1, 2021 till March 31, 2026, and shall continue to discharge his roles and duties as managing director and chief executive officer during this period,” the QIP document read.

Besides his base salary, Goyal is entitled to a variable pay, which is at the discretion of the company’s board, and statutory benefits.

The founder, who holds a 4.18% stake in Zomato, will also be entitled to a cash payment of INR 1.75 Cr within a month of cessation of employment. 

Zomato’s QIP opened on Monday (November 25) and the company set a floor price of INR 265.91 per share for it. Zomato said it may offer a discount of up to 5% on the floor price.

The QIP issue is expected to see participation from qualified institutional investors in India, as well as Europe and the US. The bidders will feature alternate investment funds registered with SEBI, eligible FPIs, mutual funds registered with SEBI, venture capital (VC) funds registered with SEBI, foreign VC investors, among others.

The company plans to use the QIP funds for the following initiatives:

• Zomato has reserved INR 2,137 Cr to set up Blinkit’s dark stores and warehouses. As of September 30, it operated 791 dark stores across 48 cities in India. It proposes to open additional dark stores in order to scale up its existing network across cities as well as expand into new cities in India. It is yet to identify the locations for setting up the said dark stores.  The company said that the average built-up area of 3,100 sq ft of dark store will cost INR 58 Lakh. Besides, the total average operational expenditure for running a dark store stands at INR 12 Lakh for Zomato.

• Zomato will use INR 2,492 for brand building and advertising initiatives. It plans to ramp up its ad expenses in the near future, expecting to deploy INR 2,492 Cr towards advertising activities on or before March 31, 2028. 
• Zomato will invest INR 1,769 Cr to build its cloud infrastructure and tech capabilities to maintain and enhance the technology infrastructure as necessary according to business needs

The rest of the funds will be reserved for general corporate purposes. 

Zomato Shuts Shops In Qatar

In an exchange filing, Zomato also informed about the closure of its operations in Qatar. The company said that its step-down subsidiary, Zomato Internet LLC (ZIL), didn’t have active business operations and was under the process of liquidation since the time of it filing its red herring prospectus (RHP) in July 2021. 

As per the RHP, ZIL was incorporated as a limited liability company under the Companies Regulations on December 28, 2016 with the Qatar Financial Centre Companies Registration Office. 

It was engaged in the business of professional services of information services of online restaurant ordering, table reservations and advertisement services. 

Zomato’s RHP showed that the closing liability and amount charged to restate the consolidated financial statement for ZIL was INR 2.3 Lakh.

Shares of Zomato ended today’s trading session 3.58% higher at INR 273.60.