New Delhi: On August 1, Zomato announced the launch of its new app ‘District,’ which will bring together various going-out services like dining, movie, and event ticketing. This is a significant step for Zomato as it moves beyond its core focus on food delivery and into a wider range of lifestyle services. The app will offer a single platform for activities such as dining out, watching movies, booking sports events, attending live performances, shopping, and staycations.
CEO Deepinder Goyal shared the news in a letter to shareholders, mentioning that Zomato and Blinkit are currently their two main consumer businesses, both of which cater to at-home needs. However, Zomato also runs one of India’s largest ‘going-out’ businesses, helping people find restaurants for dining out. Although the app’s release date hasn’t been revealed, Goyal noted that this business segment is already profitable and operating at an annualized Gross Order Value (GOV) of over $500 million.
Zomato’s going-out business currently includes its dining-out services in India and the UAE, as well as its ticketing service, Zomato Live. In the June quarter, this segment’s gross order value grew by 105% compared to the previous year, reaching Rs 1,268 crore, with adjusted revenue more than doubling to Rs 95 crore. Profitability also saw a big increase, with adjusted EBITDA rising by 233% to Rs 10 crore.
The ‘District’ app aims to become a one-stop destination for all going-out needs, and if successful, it could become a major business for Zomato. Zomato’s recent financial performance has been strong, with a big jump in net profit to Rs 253 crore for the June quarter and a 74% increase in revenue to Rs 4,206 crore, despite challenges in the broader e-commerce sector.
Zomato’s interest in expanding its going-out business became clearer in June when it confirmed talks to acquire Paytm’s movie-ticketing and events business in a deal that could be worth between Rs 1,500 crore and Rs 2,000 crore. If the deal goes through, it could significantly strengthen Zomato’s position in the going-out market.
Goyal believes there’s a big opportunity to grow Zomato’s going-out offerings beyond just dining, including other activities like movies, sports events, live performances, shopping, and staycations, many of which are already in development. This move puts Zomato in direct competition with apps like BookMyShow, which is a leader in India’s online movie-ticket booking market.
To support this initiative, Zomato has brought back two senior executives, Rahul Ganjoo and Pradyot Ghate, to work on new ideas for the going-out business. While food delivery growth may be slowing, Zomato’s expansion into quick commerce and the going-out market shows a strategic shift to sustain its growth and diversify its services.
