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Quick commerce major Zepto could make its stock market debut at a valuation significantly below its peak private valuation of $7 Bn, as investors weigh concerns over its cash burn and path to profitability alongside broader geopolitical uncertainty and market volatility. 

Foreign investors have indicated interest in Zepto’s upcoming IPO at a pre-money valuation of about $4.5 Bn, implying a post-money valuation of about $5.1 Bn, sources told Inc42.

Despite the valuation discount, the IPO continues to attract institutional investor interest, the sources said. Norway’s sovereign wealth fund Norges and Motilal Oswal are expected to together account for about 40-45% of Zepto’s anchor book, the sources added.

The valuation details were first reported by Bloomberg, while Moneycontrol reported the anchor investor details first.

The sources added that the IPO has also drawn interest from domestic institutional investors, with the anchor book nearing completion.

Inc42 has reached out to Zepto for comments on the reported valuation and the composition of its anchor book. The story will be updated if the company responds.

However, the valuation remains fluid until the anchor book closes and the final price band is announced, with the eventual pricing expected to depend on investor demand and prevailing market conditions, sources said.

The valuation discussions come at a time when investors are placing greater emphasis on profitability and cash flow, potentially making it harder for new-age tech companies to command the lofty valuations they secured in the private markets.

Last month, Zepto filed its updated UDRHP for its planned IPO. The issue comprises a fresh issue of shares worth ₹8,010 Cr and an offer for sale (OFS) of up to 11.35 Cr shares.

Zepto plans to use ₹1,629 Cr from the fresh issue to set up 1,904 dark stores by FY30 and another ₹1,734.9 Cr towards lease payments for these facilities. It has also earmarked ₹1,324.8 Cr for technology and cloud infrastructure and ₹520 Cr for marketing through its marketplace subsidiary. The remaining proceeds will be used for potential acquisitions and general corporate purposes.

Zepto’s net loss widened to ₹5,095 Cr in FY26 from ₹4,697 Cr in the previous year, even as operating revenue nearly doubled to ₹22,624 Cr.

However, the UDRHP also pointed to improving operational efficiency. Adjusted EBITDA loss per order narrowed to ₹79 from ₹136 in FY25, while free cash flow burn per order declined to ₹68 from ₹161, driven by higher order density, better dark store productivity and the growth of high-margin businesses such as advertising, which generated ₹1,636 Cr in FY26. 

Despite these gains, Zepto continued to report negative operating cash flows and a free cash flow deficit of ₹4,330 Cr, highlighting that profitability remains some way off.

Ahead of the IPO, Zepto is also expanding its offerings as it looks to improve its top and bottom lines amid intense competition in the quick commerce segment. The startup has launched Zepto Club, an invite-only membership programme, marking its return to subscriptions after discontinuing Zepto Pass and Zepto Daily.

Priced at an introductory ₹99 per month, Zepto Club offers 5% cashback in Z-Coins, free delivery on eligible orders, priority delivery and exclusive offers.

The launch came days after it was reported that Zepto was exploring a premium grocery service ‘Select’ within its app. The service is expected to offer imported food, gourmet groceries and other premium products. The offering is still at an early stage and its branding has not yet been finalised.

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