Zepto co-founder Adit Pallichta told analysts and investors on Tuesday that he expects the Indian delivery startup to grow 150% over the next 12 months, a staggering figure that shows no sign of slowing down India’s fast-growing quick-commerce market.
Palicha shared these insights during a conference call hosted by the investment bank. Attendees included representatives from several prominent investment firms, including the Abu Dhabi Investment Authority, Temasek, GIC, and Invesco, according to a report reviewed by TechCrunch.
A company spokesperson declined to comment when reached for comment Tuesday morning.
Zepto’s annual run rate recently crossed $1.5 billion, and Palicha told them that a growth rate of about 150% would push its revenue to $3.5 billion or more. Zepto competes with Zomato’s Blinkit, SoftBank-backed Swiggy Instamart and BigBasket, all of which are luring customers with 10- to 15-minute delivery services. BlinkIt’s current run rate is about $2 billion.
Quick commerce is quickly gaining traction in India’s $1.1 trillion unorganized retail market. Zepto, BlinkIt, Swiggy and Tata-owned BigBasket’s BB Now are expected to cross $6 billion in annual sales, compared to about $50 billion in overall e-commerce sales. BigBasket, an online grocer that delivers groceries to customers within hours, said on Tuesday it is fully transitioning to quick commerce.
According to industry figures, the Indian e-commerce market is growing at around 11% to 12% annually. Quickcommerce, on the other hand, has experienced growth of more than 100% annually for the past three years. Rahul Malhotra, an e-commerce analyst at Bernstein, said quickcommerce companies are “clearly taking share” from the big e-commerce players.
On Tuesday’s call, investors asked Palicha about the potential for quick commerce to expand beyond the top 12 cities in India, as the apps currently operate primarily in major urban areas. “Quick commerce is not a Tier 1 phenomenon,” Palicha said. “Our data clearly shows that there is a huge opportunity in Tier 2/3, regardless of market sentiment.”
He also confirmed during the call that Zepto has raised $1 billion in the past 90 days, which he said is the money the company needs to expand more aggressively.
TechCrunch previously reported that Zepto is now valued at $5 billion and is closing a $340 million funding round led by General Catalyst. The startup closed a $665 million funding round in June.
