Indian rapid commerce startup Zepto has unveiled plans for a roughly $1 billion initial public offering (IPO), one of Y Combinator’s largest investments in public markets outside the United States.
The filing, released on Monday, provides a rare glimpse into how one of India’s hottest startups plans to sustain its massive growth after listing. Zepto’s advertising revenue increased more than 151% year-on-year to 16.4 billion rupees (about $171 million) in fiscal 2026, outpacing the company’s 104% increase in operating revenue to 115.5 billion rupees (about $2.4 billion).
Grocery delivery remains Zepto’s core business, but the rapid growth of its advertising division signals a broader shift in how the startup makes money. The strategy pioneered by Amazon transformed the marketplace into one of the most profitable advertising businesses in the world by selling visibility to the same sellers who compete on the platform.
Founded in 2021 by Stanford dropouts Aadit Palicha and Kaivalya Vohra, Zepto has grown into one of India’s fastest-growing startups, competing with the likes of Zomato-owned Blinkit and Swiggy’s Instamart in the country’s fiercely competitive quick commerce market. Flipkart, backed by Amazon and Walmart, has also stepped up its efforts in this segment in recent months.
Despite fierce competition, Zepto has continued to add customers and orders at a rapid pace. The startup processed more than 640 million orders in fiscal 2026, according to its draft prospectus, nearly double the number from the previous year, and increased its annual trading users to nearly 48 million. Despite expanding the network to 1,139 stores, orders per store continued to increase, suggesting that demand is increasing along with store size.
But this growth comes at a cost. Zepto is still in the red, posting a net loss of 59.1 billion rupees (about $617.36 million) in fiscal 2026, compared with 47 billion rupees (about $492.45 million) a year ago. The startup acknowledged in the filing that it may continue to incur losses and may not be able to maintain its historical growth rates. This is a standard, but disclosure that highlights the tensions faced by venture-backed companies seeking public market investors before they reach profitability.
Zepto plans to raise up to 80.1 billion rupees (about $837.41 million) through a fresh share issue. The IPO will also include an offer for sale of up to 113.5 million shares from existing investors, including Nexus Venture Partners, Contrary and Razor Ventures, with the final sale size depending on the final price of the offering. The startup also said it could raise up to ₹16.02 billion (about $167 million) from investors through a pre-IPO placement ahead of the listing.
This list is set up to provide closely watched results for some of Zepto’s early backers. The startup was valued at $7 billion in its last funding round in October, and investors include Y Combinator, Lachy Groom, Nexus Venture Partners, StepStone, Glade Brook, and Lightspeed.
Several prominent shareholders, including Y Combinator-affiliated funds, Lightspeed, StepStone, Groom, and Glade Brook, decided not to participate in the IPO’s sale offer and instead retain their stake as the startup prepares for its market debut. It’s worth stopping for a moment. Zepto’s public market value remains uncertain, and some mutual funds and family offices that reviewed the company ahead of its IPO indicated a much lower valuation than the last private round, according to people familiar with the matter.
According to the filing, Zepto’s founders received a subpoena from India’s anti-money laundering agency, the Enforcement Directorate, in April seeking information related to foreign investments, the company’s shareholding structure and other matters under the country’s foreign exchange laws.
The two subsequently appeared before the authorities and provided requested information and documents. Zepto said it had received no further communication from regulators since then, but warned it could not rule out future investigations, probes or penalties.
The proposed listing marks the culmination of years of effort to prepare the startup for its domestic market debut. Zepto moved its legal home from Singapore to India last year, joining a growing number of startups that are restructuring their holding companies as local public markets become increasingly attractive for tech listings.
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