India’s leading foodtech platform Zomato has implemented its fourth platform fee hike of 2024, raising it to ₹10 from ₹7, as the company navigates through the festive season rush. The move, confirmed through an exchange filing on October 24, marks a substantial 400% increase from the initial ₹2 fee introduced in August 2023.
The fee adjustment comes at a crucial time for the Deepinder Goyal-led company, which recently reported its Q2 FY25 financial results showing a 30% sequential decline in net profit to ₹176 crore, down from ₹253 crore in the previous quarter. However, the company’s operating revenue demonstrated strong growth, increasing by 14% to ₹4,799 crore.
According to the company’s app notification, “This fee helps us pay our bills to keep Zomato running. To maintain services during the festive season, it has increased slightly.” The strategic timing of the hike coincides with the peak demand period of India’s festive season, potentially impacting millions of customers across the country.
The platform fee has become an increasingly significant revenue stream for Zomato, with the company collecting ₹75 crore from platform fees in Q2 FY25 alone—its most lucrative quarter ever in terms of platform fee revenue. This represents a 41.5% sequential increase from Q1 FY25’s ₹53 crore collection. The total platform fee revenue for the first half of FY25 has already reached ₹128 crore, significantly surpassing the entire FY24 collection of ₹83 crore.
Despite the fee increases, Zomato continues to show strong operational metrics. The company’s food delivery gross order value (GOV) rose 5% sequentially to ₹9,690 crore in Q2 FY25, while its quick commerce business Blinkit witnessed an impressive 25% quarter-over-quarter growth to ₹6,132 crore. The platform maintains a healthy base of 20.7 million average monthly transacting customers.
In a significant move to strengthen its financial position, Zomato has received board approval to raise ₹8,500 crore through a qualified institutional placement (QIP). This decision comes as the competitive landscape in India’s food delivery sector intensifies, with rival Swiggy offering shares worth $448 million in its IPO and Zepto raising $340 million in August while preparing for a 2025 listing.
The implications for India’s startup ecosystem are noteworthy. Zomato’s ability to implement successive fee hikes while maintaining growth signals a maturing market where customers are willing to absorb incremental costs for convenience. However, the company’s profit decline despite revenue growth highlights the ongoing challenges in balancing profitability with market expansion in the foodtech sector.
The development is particularly significant as it demonstrates the evolving dynamics of India’s startup ecosystem, where companies are increasingly focusing on sustainable revenue models rather than purely growth-oriented strategies. As competition intensifies and investor focus shifts toward profitability, such strategic pricing decisions may become more common across the sector.
This latest platform fee hike, coupled with Zomato’s financial performance and fundraising plans, underscores the complex balancing act between growth, profitability, and market competition in India’s maturing startup landscape. As the festive season progresses, the industry will be watching closely to see how these strategic decisions impact both customer behavior and the company’s financial metrics.
