Alibaba-Backed Unicorn That Acquired Uber Eats India Opens 53% Higher After $1.3B IPO

Alibaba Group Holding Limited (NYSE: BABA)-backed Indian food delivery startup Zomato Ltd made a strong debut on the stock market Friday, with its shares opening nearly 53% higher.

What Happened: Zomato’s shares opened at INR 116 ($1.57) per share on the National Stock Exchange of India, representing a 52.6% premium to its initial public offering price of INR 76 ($1.03) a share. The stellar debut valued the company at about INR 910 billion ($12.2 billion).

The company, which filed to go public in April, saw strong demand, raising $1.3 billion in what became India's largest tech initial public offering ever.

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Why It Matters: Zomato and rival start-up Swiggy dominate India’s highly competitive online food delivery market, which is projected to grow from $4.7 billion in 2020 to $21.4 billion by 2026, according to a report by ResearchAndMarkets.com.

As of March 2021, Zomato has a presence in 525 cities in India, with nearly 390,000 active restaurant listings.

Uber Technologies Inc. (NYSE: UBER) sold the Indian operations of Uber Eats to Zomato last year. Alibaba-affiliate Ant Group is a prominent investor in Zomato.

Price Action: Zomato’s shares are currently trading at INR 126.25, up 8.8% from their opening price.

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