Summary of this article
Zepto may delay its IPO as valuation talks with investors continue over pricing
Investors want a much lower valuation than Zepto's earlier expectations for the listing
Proposed IPO size may shrink significantly from earlier plans
Quick commerce firm Zepto is likely to defer its initial public offering (IPO) by a few weeks as it continues negotiations with institutional investors over valuation, according to an Economic Times report.
Zepto has received pricing bids from large institutional investors and is now negotiating with them over the valuation for its IPO. The company is expected to take a final decision in the next week or two. While it still wants to go ahead with the IPO, it could delay the listing if both sides fail to agree on the valuation.
The discussions come less than a year after Zepto raised $450 million in October 2025 at a valuation of $7 billion.
Zepto’s Valuation May Be Cut By More Than Half
According to a Financial Express report, Zepto is now in talks to launch its IPO at a post-money valuation of around $3 billion, with a pre-money valuation of about $2.5 billion. This is less than half the $7 billion valuation at which it last raised funds.
The lower valuation comes after domestic mutual funds and insurance companies were unwilling to invest at the company's earlier asking price. The report said investors wanted the valuation to be 30-40 per cent lower than the $4-5 billion range that Zepto was willing to accept.
IPO Size Likely To Be Smaller
At the revised valuation, Zepto is expected to raise around Rs 5,000 crore through a fresh issue, along with a small offer for sale by existing shareholders, according to the report.
The report said the anchor investor portion could be around Rs 2,300 crore, while qualified institutional buyers may be allotted shares worth about Rs 1,530 crore. The high-net-worth investor segment could account for around Rs 766 crore, and the retail investor portion about Rs 511 crore.
The final issue size and share allocation will depend on investor response.
This is a much smaller amount than the company's earlier IPO plan. In its updated draft red herring prospectus, Zepto had proposed a fresh issue of up to Rs 8,010 crore, along with an offer for sale of up to 113.47 million shares by existing investors.
Why Investors Are Pushing Back
One of the key sticking points is the valuation benchmark.
The report, citing people aware of the discussions, said, Zepto wanted its IPO to be valued on par with listed peers Eternal and Swiggy. Institutional investors, however, argued that the comparison is not appropriate because both companies generate a significant share of their revenue from food delivery, while Zepto's business is almost entirely focused on quick commerce.
Investor appetite for new-age technology listings has also weakened after several recent IPOs delivered disappointing post-listing returns. Swiggy, for instance, continues to trade well below its IPO price, making institutional investors more cautious about fresh technology listings.
Bankers managing the issue, along with one of Zepto's existing investors, are now trying to bridge the valuation gap while also seeking commitments from high-net-worth individuals and family offices.
Zepto received Sebi's approval for its IPO in April 2026. The company is led by co-founder and Chief Executive Officer Aadit Palicha and last raised capital from investors including California Public Employees' Retirement System (CalPERS) during its October 2025 funding round.
Second Attempt At Going Public
This is not Zepto's first attempt to go public.
The company had planned to launch its IPO in 2025 but postponed it due to weak market conditions, muted investor interest in new-age technology companies and valuation concerns. It later shifted its domicile from Singapore to India, increased domestic ownership and restarted the listing process before filing its updated draft papers with the Securities and Exchange Board of India (Sebi).
