Indian quick-commerce startup Zepto has filed for an initial public offering that could value the company at about $1 billion, setting up a public-market test for one of Y Combinator’s largest bets outside the United States. The draft prospectus shows a business growing quickly on revenue, orders, users, and store count — but also one still posting heavy losses, with a valuation question that remains unresolved.
Growth is still the headline
Zepto’s filing, released Monday, paints a picture of a startup expanding at a rapid pace even in a fiercely competitive market. The company said advertising revenue rose more than 151% year over year to ₹16.4 billion, or about $171 million, in fiscal 2026. That outpaced operating revenue growth of 104%, to ₹115.5 billion, or around $2.4 billion, over the same period.
While grocery delivery remains Zepto’s core business, the stronger growth in ads suggests the company is broadening its monetization strategy. The model resembles Amazon’s approach, in which merchants pay for visibility on a marketplace and advertising becomes a major profit pool.
Orders, users, and stores all climbed
Founded in 2021 by Stanford dropouts Aadit Palicha and Kaivalya Vohra, Zepto has become one of India’s most closely watched startups. It competes with Zomato-owned Blinkit and Swiggy’s Instamart in the country’s quick-commerce sector, while Amazon and Walmart-backed Flipkart have also stepped up their efforts in the space in recent months.
The draft prospectus shows that the company processed more than 640 million orders in fiscal 2026, nearly double the prior year. Annual transacting users rose to almost 48 million. Zepto also expanded its store network to 1,139 locations, and orders per store continued to increase, indicating that demand is rising alongside expansion.
- Advertising revenue: ₹16.4 billion, up more than 151%
- Operating revenue: ₹115.5 billion, up 104%
- Orders processed: more than 640 million
- Annual transacting users: almost 48 million
- Stores: 1,139
Losses widened despite the expansion
That growth is still coming at a significant cost. Zepto reported a net loss of ₹59.1 billion, or about $617.36 million, in fiscal 2026, compared with ₹47.0 billion, or around $492.45 million, a year earlier.
In its filing, the startup acknowledged that it may continue to incur losses and may not be able to sustain its historical growth rates. That kind of disclosure is standard in IPO paperwork, but it underscores the challenge for venture-backed companies trying to reach public markets before they turn profitable.
What the company is trying to raise
Zepto plans to raise up to ₹80.1 billion, or about $837.41 million, through a fresh issue of shares. The IPO also includes an offer-for-sale of up to 113.5 million shares by existing investors, including Nexus Venture Partners, Contrary, and Razor Ventures. The final size of that sale will depend on the pricing of the offering.
The company also said it may raise up to ₹16.02 billion, or about $167 million, from investors in a pre-IPO placement before listing.
Valuation remains the unanswered question
The listing is expected to be an important outcome for early backers, but the market’s view of Zepto’s worth is still unclear. The startup was valued at $7 billion in its last funding round in October and counts Y Combinator, Lachy Groom, Nexus Venture Partners, StepStone, Glade Brook, and Lightspeed among its investors.
Several prominent shareholders — including Y Combinator-affiliated funds, Lightspeed, StepStone, Groom, and Glade Brook — are not participating in the IPO’s offer-for-sale and will keep their stakes as the company heads toward its public debut.
That decision comes as some investors reviewing the company ahead of the IPO have reportedly indicated valuations well below the last private round, according to people familiar with the matter. Zepto’s public-market valuation has not been set, leaving open the question of whether the listing will approach its previous $7 billion mark or land meaningfully lower.
Regulatory scrutiny appears in the filing
The prospectus also disclosed that Zepto’s founders received summonses in April from India’s Enforcement Directorate, the country’s anti-money laundering agency. The requests concerned foreign investments, the company’s shareholding structure, and other matters under India’s foreign-exchange laws.
According to the filing, Aadit Palicha and Kaivalya Vohra appeared before the agency and provided the requested information and documents. Zepto said it has not received any further communication from the regulator since then, while cautioning that it cannot rule out future inquiries, investigations, or penalties.
Why the listing matters
Zepto’s move reflects a broader shift among Indian startups that are restructuring their holding companies to make domestic public listings easier. The company relocated its legal home from Singapore to India last year, joining a growing list of tech firms adapting to the country’s increasingly active public markets.
For Zepto, the IPO is a milestone after years of preparation. For investors, it will be a live test of whether rapid growth, rising ad revenue, and expanding scale can outweigh deep losses and a still-uncertain valuation in one of the world’s most competitive consumer internet markets.
Source: Original report
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Last Modified: July 7, 2026 at 9:43 pm
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