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Funding · Commerce & Consumer Brands

Zepto raises ₹1,500 crore structured debt to boost Indian ownership ahead of IPO

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Date
Company
Zepto
What it does
quick commerce platform
Kind
Funding
Amount
₹1,500 crore
Stage
structured debt
Based in
Mumbai
Founded
2021
Sector
Commerce & Consumer Brands

What they do

Zepto is a quick commerce platform that delivers groceries and daily essentials to customers in India

What happened

The company is raising ₹1,500 crore (about $175 million) in structured debt to buy shares from foreign investors and increase Indian ownership before its…

Why it matters

The deal is expected to raise Zepto's valuation to $5 billion and increase the founders' stake to around 20%

The details

  • Zepto is raising ₹1,500 crore in structured debt to increase its Indian ownership ahead of its planned IPO.
  • The funds will be used to buy shares from foreign investors, increasing the company's domestic shareholding to over 30%.
  • Edelweiss Alternative Asset is leading the deal, with domestic family offices and smaller credit funds contributing the remaining ₹750 crore.
  • The structured debt carries a minimum interest rate of 16%, with an equity-linked upside that could enhance total returns to about 18%.
  • The deal is expected to close by July and will see Edelweiss underwriting the bulk of the loan.
  • The transaction is being executed at a valuation of nearly $5 billion, the same as when Zepto raised equity financing last year.

The bigger picture

  • The move is aimed at complying with India's foreign direct investment (FDI) regulations that govern online retail and meet the Indian ownership threshold.
  • India's FDI rules allow 100% foreign investment in online marketplace models but ban FDI in inventory-led e-commerce.
  • To qualify as an Indian Owned and Controlled Company (IOCC), a company must have more than 50% Indian ownership and control.
  • The founders are increasing their stake in the company to around 20%, from the current 18%, and the domestic shareholding may be 30% once the deal is finalised.

About the business

  • Zepto is a quick commerce platform that delivers groceries and daily essentials to customers in India.
  • The company operates in a highly competitive market with rivals such as Blinkit and Swiggy Instamart.
  • Zepto is known for its fast delivery and has been expanding its operations across major cities in India.
  • The company is preparing for an initial public offering (IPO) and is working to meet the regulatory requirements for listing on the stock exchange.
  • Zepto's founders have been increasing their stake in the company to ensure greater control and compliance with Indian regulations.

What happens next

  • Zepto is expected to file its IPO draft papers in mid-2025.
  • The company has already secured approvals to shift its base from Singapore to India.
  • Zepto is also close to completing a $250 million secondary share sale involving private equity firms like Motilal Oswal.

The deal

Type
structured debt

Investors

  • Edelweiss Alternative Asset (lead) — A financial services company that provides structured debt solutions.
  • Domestic family offices (investor) — Private investors who manage wealth on behalf of high-net-worth individuals.
  • Smaller credit funds (investor) — Investment funds that focus on credit-based financing.

Founders

  • Aadit Palicha, co-founder
  • Kaivalya Vohra, co-founder

About Zepto

Product
A rapid-delivery app for groceries and everyday essentials.
Customers
Consumers ordering groceries and essentials online.
How it makes money
It earns from product margins, delivery fees, and order-value thresholds across its quick-commerce network.
What sets it apart
It was built as a quick-commerce native company from day one.
Operations
Operates dark-store based 10-minute delivery across multiple Indian cities.

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