Blinkit now more valuable than Zomato's food delivery business: Goldman Sachs

Goldman Sachs now values Blinkit at ₹119 per share at a $13 billion equity valuation.

Analysts at Goldman Sachs said that the implied value of Blinkit, the quick commerce startup that Zomato acquired in 2022, is now larger than that of Zomato’s food delivery business. Goldman Sachs now values Blinkit at ₹119 per share at a $13 billion equity valuation which is higher than the food delivery business that is being valued at ₹98 per share.

Blinkit and Zomato logos are seen in this illustration. (Reuters)

Zomato acquired Blinkit for $568 million in 2022. Since then Blinkit’s implied valuation has grown to $13 billion on the back of improved performance, Goldman Sachs analysts said.

What Goldman Sachs had said earlier on Blinkit?

The latest $13 billion valuation for Blinkit is an upgrade from Goldman Sachs’ earlier estimate of $8 billion which was made earlier this month. Goldman Sachs said that higher gross order value (GOV) estimates for Blinkit, that is tracking around 50 percent higher than estimates from one year ago, have resulted in the upgrade.

“We note that Blinkit’s implied valuation in our Zomato’s sum of the parts (SOTP) is (close to) $13 billion now, versus $2 billion in March 2023, with per share implied value of ₹119 higher than food delivery, at ₹98, for the first time,” Goldman Sachs said in its note.

What Goldman Sachs said on Zomato?

Goldman Sachs said that it sees further potential for Zomato's valuation multiples to re-rate as the brokerage highlighted that Zomato's EBITDA margin is the highest among global food delivery platforms.

Maintaining a 'buy' recommendation on the stock, Goldman Sachs raised the price target on the food delivery aggregator to ₹240 from ₹170 earlier.