Zomato Buys Paytm's Ticketing and Entertainment Business | Vantage with Palki Sharma

Summary

Zomato, India's food delivery giant, is acquiring PTM Insider, a ticketing platform for entertainment and sports events, for approximately $238 million. This move is part of Zomato's strategy to diversify beyond home delivery, with the launch of their new 'District' app consolidating outdoor activities. PTM, on the other hand, is refocusing on its core finance business following regulatory issues. The acquisition is seen positively by shareholders and aligns with market predictions that quick commerce and ticketing services are the next growth areas for Zomato.

Takeaways

• 📢 Zomato, a food delivery business in India, is acquiring PTM Insider, the entertainment ticketing app of PTM, for approximately 2,000 CR Rupees ($238 million).
• 📲 Zomato is launching a new mobile application called 'District' to consolidate its outdoor businesses, including dining out, movie tickets, and sports tickets.
• 🔄 PTM Insider users can still find ticketing options on the PTM app for the next 12 months before it migrates to Zomato's new app.
• 🏦 PTM is likely selling its ticketing business to focus on its core finance business, especially after facing regulatory issues earlier this year.
• 📈 Market reaction to the deal is positive, with Zomato shares up 2% and PTM shares up 0.3%, indicating shareholder approval.
• 🍽 Zomato's last quarter revenue was 4,200 CR rupees with a profit of 253 crores, showing a significant increase compared to the previous quarter.
• 🚀 Zomato's Quick Commerce segment grew by 222%, outpacing the 10% growth in its food delivery business, suggesting a shift in focus towards Quick Commerce.
• 🛒 Zomato plans to add 1,000 new Quick Commerce warehouses by the end of the financial year, investing nearly 300 CR rupees in this segment.
• 🎟️ Zomato aims to integrate its food delivery services with live events, such as sports and movie theaters, opening up new business opportunities.
• 🎤 Zomato is organizing a concert in Mumbai featuring Dua Lipa on November 30th, which is strategically timed after the acquisition announcement to boost ticketing traffic.
• 🌐 The dominance of BookMyShow and PTM in the online ticketing market has raised concerns about unfair charges and a lack of competition.

Q & A

What is the recent business deal between Zomato and PTM Insider?

Zomato is acquiring PTM Insider's ticketing business, which includes movie, concert, and sports tickets, for around 2,000 CR Rupees, equivalent to $238 million.

What is Zomato's strategy behind the acquisition of PTM Insider's ticketing business?

Zomato is diversifying its business model. They have unveiled a new mobile application called District, which will consolidate Zomato's outdoor business, including the newly acquired ticketing services.

How will PTM Insider's ticketing business transition post-acquisition?

For the next 12 months, users can still find ticketing options on PTM Insider. After that period, the service will migrate to Zomato's new District app.

Why is PTM considering selling its ticketing business despite its profitability?

PTM may be looking to focus on its core business in finance, especially after facing regulatory issues that led to the shutdown of PTM's payments bank earlier this year.

How have the shareholders of Zomato and PTM reacted to the deal?

The shareholders have welcomed the deal, as evidenced by a 2% rise in Zomato shares and a 0.3% rise in PTM shares.

What was Zomato's financial performance in the last quarter, and how does it compare to the previous quarter?

In the last quarter, Zomato posted 4,200 CR rupees in revenue, with a profit of 253 crores. This is a significant jump compared to the previous quarter.

What is the growth rate of Zomato's food delivery business compared to its quick commerce business?

While Zomato's food business revenue increased by 10%, its quick commerce revenue, which includes the Blinket service, surged by 222%.

Why did Zomato decide to scrap its inter-city food delivery option?

Zomato scrapped the inter-city food delivery option because it did not gain traction among users.

What is Zomato's plan for expanding its quick commerce business?

Zomato plans to add 1,000 new Blinket warehouses by the end of the financial year and is investing nearly 300 CR rupees in this financial year.

How does Zomato envision integrating the newly acquired ticketing business with its existing services?

Zomato could integrate the ticketing business by offering food delivery at sports events or food orders at movie halls, creating new opportunities for cross-promotion and service enhancement.

What is the significance of the 'Feeding India' concert organized by Zomato?

The 'Feeding India' concert, headlined by Dua Lipa and organized by Zomato, is a strategic move to kick off the newly acquired ticketing business and attract traffic to it.

What are the potential downsides of the dominance of BookMyShow and PTM in the online multiplex booking space?

The dominance of these two players, which make up 90% of all online multiplex bookings, has led to criticism from Indian courts for imposing unfair charges, such as internet handling fees.

What is Zomato's ultimate ambition with its business model?

Zomato aims to become India's lifestyle platform, offering services for food, movies, concerts, and other indoor and outdoor activities.