Zomato, the prominent player in the food technology industry, has revealed plans to liquidate its Czech Republic-based subsidiary, Lunchtime.cz s.r.o., according to an exchange filing.
In compliance with Regulation 30 of the Listing Regulations, Zomato stated, “Lunchtime.cz s.r.o. (‘Lunchtime’), a step-down subsidiary of Zomato Limited (‘the Company’) situated in the Czech Republic, has initiated the process of liquidation on September 01, 2023.”
Lunchtime, which was a subsidiary of Zomato, had ceased its active business operations. The subsidiary holds a valuation of INR 28.2 Lakhs and has made no contributions to Zomato’s net worth due to its lack of turnover.
Zomato’s decision to liquidate Lunchtime aligns with the company’s strategy of streamlining its global operations and focusing more on the Indian market. In the current year, Zomato has already closed non-operational subsidiaries in various countries, including Indonesia, Portugal, Jordan, and announced its planned exit from the Philippines.
Presently, Zomato maintains active operations solely in India and the UAE. In November 2022, Kuwait-based foodtech startup Talabat, which had acquired Zomato’s food delivery unit in the UAE in 2019, discontinued the service. However, Zomato continues to provide restaurant discovery and dining-out services in the UAE.
Earlier this year, Zomato decided to withdraw from around 225 smaller cities in India due to their poor performance, representing only 0.3% of its Gross Order Value (GOV) in Q3FY23. To optimize monetization and sustain operations in these smaller cities, the company introduced a platform fee ranging from INR 1 to INR 3 per order.
Zomato’s efforts in monetization and cost-cutting bore fruit as the company achieved profitability, posting a profit of INR 2 Crores for the June quarter of FY24, marking its first-ever profit.
The recent sale of Zomato shares by Tiger Global and SoftBank resulted in Tiger Global completely exiting the startup, which in turn led to a surge in Zomato’s share price.
Zomato’s shares have witnessed strong performance in recent months, reaching a 52-week high of INR 102.85 apiece last month. As of Monday (September 4), at 1:15 PM, the foodtech company’s shares were trading at INR 98.05 on the BSE, slightly higher than the previous Friday’s closing price.
This move reflects Zomato’s strategic focus on its core markets and sustainable growth in the food technology industry.