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Zomato Ltd
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Ladies and gentlemen, a very good evening and welcome to Zomato Limited's Q1 FY '14 Earnings Conference Call. From Zomato's management team, we have with us today Deepinder Goyal, Founder and Chief Executive Officer; Akshant Goyal, Chief Financial Officer; Albinder Dhindsa, Founder and CEO of Blinkit; and Kunal Swarup, Head of Corporate Development. Before we begin, a few quick announcements for the attendees. Anything said on this call, which reflects outlook for the future or which could be construed as a forward-looking statement may involve risks and uncertainties. Such statements or comments are not guarantees of future performance, and actual results may differ from those statements.Additionally, please note that this earnings call is scheduled for a duration of 45 minutes, and we will be starting with the Q&A section of the call. If you wish to ask a question, please use the raise hand feature available on your Zoom dashboard. We will announce your name on the call and view your line post which you can proceed with your questions. We will wait for a minute while the question queue assembles.The first question is from the line of Mr. Sachin Salgaonkar from Bank of America. Please go ahead.
Hi, thank you for the opportunity. Congratulations for a great set of numbers. I have 3 questions. First question is regarding the 11% Q-o-Q GOV growth. Clearly, the 4 reasons what you guys have given is clear, but I just wanted to check how much was the IPL impact? And any way you guys could quantify that?
Hi Sachin, thank you for your questions. Akshant on this side. So you know IPL over the years, you've seen last few years, as we've seen that it doesn't have too much of an impact on our business, except for a few matches towards the fag end. So I think seasonality has more to do with the weather, school holidays and stuff like that. And this was pretty clear to us, I think the year before last, when the IPL actually got shifted to October quarter. And it was during last year that we saw that our business even in the summer was still higher despite there being no IPL. So I think it's fairly clear to us now that IPL has very limited impact on our business.
And just an extension of this question. Is the answer similar to the World Cup, which comes once every 4 years.
So I mean like 4 years ago, we don't know our business is very different. So we don't have enough data points to respond to that. But in general, any matches and cricket matches where the viewership is very high, is where we see some impact on upside. So we are hoping that World Cup will be different, given it happens once in 4 years, and it's happening in India this time. So we are expecting some upside, but we'll have to see how it plays.
Okay. Great. My second question is regards to AOV of Blinkit. Now clearly, your AOV is much higher than most of your competitors. And for last few quarters, we had seen a sort of declining trend. But this quarter, it did improve. So just wanted to understand your thoughts per se, how sustainable we should look at it going ahead?
[Indiscernible] so like we have mentioned a couple of times before also, our business because it deals with such a wide variety of products. The AOV movement does tend to move with seasons as well. This quarter's AOV movement that you're seeing part of it was also a result of the fact that we were a little bit supply constrained, but that drove about 25% of the overall AOV improvement. The rest of it is mostly seasonal changes, consumption patterns, especially in the pole FMCG and grocery space. And that's what usually dries up the AOV during some parts of the month. So you will see more variability in AOV, not consistently going up or down, but will be catering to our business projections and how we think about the business.
Got it, thank you, and last question, just wanted to understand medium-term sustainable margins in food, which is GOV as a percentage of adjusted EBITDA. So you guys said 4% to 5% is what you guys are looking in the next few quarters. I just wanted to understand from a medium-term perspective where it could set it?
Next few quarters is medium term only no.
Okay, so let me turn it from a long-term perspective, where do you guys want to see that certainly.
Hard to say, I think, first, you want to get to this kind of a margin profile and then we'll see how the business evolves after that.
Got it. Okay. All the best for your future.
Thank you. Next question is from the line of Mr. Vijit Jain from Citigroup. Please go ahead.
Hi, thank you, congratulations for a great set of numbers. My question is just a Q-o-Q drop in employee expenses. Just wondering if there's anything to that? I'm talking about expenses, excluding the ESOP charges. That's question one.
Hi Vijit. So yes, I think our employee expenses have come down last 2 quarters. And I think largely a function of the rightsizing that we did in the December quarter. So I think all of that is fully flowing into our P&L now given that there were some severance payouts in the previous quarter. So I think that's why you see that decline.
Got it. So, Akshant, fair to say this would include any annual pay hike or is that in a different cycle for you guys?
So our cycle is actually July to July. So you will see that impact in the next quarter.
Okay. Got it. My next question is on just a couple of things on the delivery rider fees in general. So there was this news recently for Rajasthan government exploring some kind of a rule on compensation to [indiscernible] workers. So just wondering if there's any clarity on how that impacts your business? And related to that, is there any adjustment to how you compensate delivery riders post the event side think it in Gurgaon. So just a broad question on delivery rider side there.
Yes, Vijit. So I think on that one, we don't have full clarity yet. I think we're still waiting for more clarity there. And I think basis that we'll be able to ascertain on the steps that we need to take to manage that. But at this point, I think it's a very broad-based bill, and there are no specific details. So we're just waiting and watching right now.
Got it. And how about any changes that you have implemented on the Blinkit side? I'm just wondering on the Blinkit side, have your delivery cost per order changed this quarter or most of the improvement is just led by the higher AOV in terms of contribution margins?
Hi Vijit, this is Albinder. So the changes that we made in April was to bring all our delivery partners onto the same kind of payout structure so that it was more even across the board. And we have not made any changes beyond that. The overall cost of delivery for us did not decrease significantly during the quarter. And because that was not the intent of the changes that we were making as well. So the delivery payouts per order to our delivery partners have remained broadly the same. Most of the improvement that you're seeing on the contribution side is coming more from operating leverage of our fixed assets as well as improving margin profile and improving average ticket sizes.
Got it. Yes, those are my questions. I'll just jump back into the queue.
Thank you. Next question is from the line of Mr. Swapnil Potdukhe from JM Financial. Please go ahead.
Hi everyone, thanks for the opportunity, great set of numbers. I have a couple of questions on the delivery side and a couple of the commerce side. First, there has been a mention of some risky bets that seem to have paid off for you. Would you be able to call them out? And in the same rate, can you also mention any more initiatives that you are working on that can be termed [indiscernible]?
No, I think the reference Swapnil, there was largely to the changes that we did on the people side and some calls we took on driving growth like on Zomato Gold, where at that time, we felt that there was a perception that it will impact the business in a negative way. So I think largely, that was what we meant this. We're not talking about any business calls here, which investors are not aware of.
Got it. And secondly, there has been a 100 basis point Q-on-Q improvement in the take rates. Now would you be able to call out how much of that is because of ad income, pure-play restaurant commissions and maybe Gold separately?
No Swapnil, I'm sorry, we will not be able to share those details.
Okay. And on the Blinkit side, so would it be possible to share the GMV mix over there. Now what I understand now is like your non-grocery mix appears to be improving. And it would be great if you guys can call that out in some form or the other.
Swapnil, we don't give out the breakout for individual product categories that we sell. The mindset with the update is that we are always looking to bring more convenience across more product categories for our customer. So we've been increasing the size of portfolio available in 10 minutes to our customers consistently over the last 1 year, and that is what is leading to improvement in the overall both the ticket size as well as the margins for us. And I think we'll continue to do that into the future as well.
And because of the disruption we saw in 1Q in Delhi NCR, did Blinkit delivery costs jump up in this particular quarter. And I presume that would be a one-off, but was that the case? And would that help you improve your contribution margins going ahead some?
So I think the delivery cost changes, like we mentioned, were not significant in this quarter. And we don't expect that number to change dramatically going forward as well. The intent of the changes for us was to make sure that our entire delivery fleet was on a more fair and equitable payout sector.So I don't think that, that is something that we are targeting. The disruptions where they affected us was because there was more misunderstanding on the ground, some of our closer shut for a few days. And even after they recovered, the number of partners coming back and working, it took some time to recover, and that's why we had a weaker April and May, and we only started recovering towards the end of May and early June. But post that, we've recovered that.
Got it. And just a last question, if I can squeeze in. How much of that $20 million that you were expecting to burn in Blinkit has already been factored in? And how much is the balance? I know that you won't be spending the entire amount, you mentioned that, but just to get a sense of that?
Swapnil, we will share that number once we get to breakeven profitability, I think so far, we're still sort of trying to calibrate on how much do we spend incrementally from here on to get to breakeven.
. Okay. No worries. So thanks a lot guys for this opportunity and great set of numbers again, all the best.
Thank you. Next question is from the line of Mr. Manish Adukia from Goldman Sachs. Please go ahead.
Hi, good evening, thank you so much for taking my questions and thank you for all the disclosure around numbers and guidance as you think about for the next few years. Just a few clarifications on some of the numbers you've given in the shareholder later. So you've called out a growth rate in Blinkit of 60% plus on GOV for the foreseeable future and overall adjusted revenue growth of 40% plus. So back of the annual calculation, would suggest maybe 25% plus or 30% thereabout kind of food delivery growth in the next few years. Firstly, do you agree with that number? Food delivery growth of 25% to 30% for the next couple of years is what you're targeting?
So we haven't stated any growth targets or guidance for food delivery Manish. And so I can't comment on this.
Right. And does that coming from your previous quarters where incrementally, most of the growth in food delivery will come from user growth, that comment would still stand, right? So if, let's say, 25%, 30% you were to grow and that large part should come from user growth? Would that be a fair assumption?
Yes Manish, and even in this quarter, you have seen the NP growth. So we expect that to continue.
Understood. My second question is maybe to Albinder. So Albinder the question, in the shareholder letter, you've said that you're determined to deliver on growth and profitability over the next few months. So again, I mean, are we to read that you're guiding for EBITDA breakeven over the next few months? Or did you mean something else?
I think we meant what we wrote. So we've mentioned 4 quarters anyways, so that's 12 months. So I don't know. I'm not sure if you got your question, Manish.
Sure. Okay. Fair enough, thank you for clarifying. And third, again, on the shareholder letter, you've talked about uses of capital or capital allocation. Thank you for the color there. But since you started generating cash now and obviously, you have a large balance sheet as well. So from a capital allocation standpoint, if you are, let's say, not focusing on any near-term M&A or acquisition, would you be considering any form of shareholder return or that is not in the foreseeable future?
So not at this point, Manish, we have thought about that. But at this point, we want to maintain the cash that we have. But down the line, we continue to reconsider that position as our business scales and as competitive dynamics change around us.
Got it, thank you so much for taking the question.
Thank you Manish.
Thank you. Next question is from the line of Mr. Gaurav Rateria from Morgan Stanley, please go ahead.
Hi, congratulations on a great set of numbers. So a few questions. The first is on contribution margin in food now at 6.4% for you to hit your target of 4% to 5% adjusted EBITDA margins, where should this number settle down? And what will be the key drivers for that?
Gaurav, largely, I think there is some bit of operating leverage if we'll continue to scale in this business. So if the EBITDA margin goes up by 2 percentage points, we can get there even with a slightly lower contribution margin growth, right? So ballpark, even in the past, we have spoken about 8% contribution to GOV this business. I think that is what we are aiming for, and we believe that should get us to the 4% to 5% EBITDA margin in this business.
Got it. Second question is how much of Hyperpure growth came from your synergies between Hyperpure and Blinkit? And is there a case to believe that e-commerce can leverage the food delivery footprint and get some synergies there as well?
Sorry, can you elaborate on the second part of the question?
How much of Hyperpure growth really came because of the synergies between the Blinkit and Hyperpure business, which you mentioned in your shareholders letter? And a question is that, is there a case to believe that quick commerce can also get some synergies from leveraging the delivery footprint of the food delivery business?
Yes. So I think as far as your first part of the question is concerned, Hyperpure business is growing on both sides now. I think the core restaurant surprise business is doing really well at more than 100% year-on-year. And equally, as we mentioned in the last couple of shareholders letter, we're also now supplying to sellers on Blinkit. So that business is scaling as well. So I think both the segments are growing well. And to your second question, like synergies between quick commerce and food delivery, I think we've spoken about a few in the past. That was your question. I just want to confirm Gaurav that the question is on [indiscernible] and food delivery synergies or something else?
Yes. Synergies between the 2 business, especially with respect to delivery cost?
Yes. I'll take that, Gaurav. I think we've explored this quite a bit. And so far, we are taking it slowly to make sure that both the businesses, especially in the overlapping cities, they are fairly sizable. So we have taken some initiatives, mostly on the technology and the platform side to be able to get better synergies out of both of them. And over time, I think we will continue to make processes and are we of operating better to be able to get more synergies out of the fairly large footprint of riders that we have across both the platforms. But as of now, like that is not something which is in active areas, both the platforms are growing fairly quickly, and we need to make sure that we have righter supplies for both of them across the board.
Got it. Last question from me. Any data point on the new customer addition during the quarter on a gross basis? Thank you.
Gaurav, I think it remains healthy. It's in line with the numbers you have shared in the past. So I think that as far as newer addition is concerned, it continues to remain robust.
Thank you. Next question is from the end of Mr. Sudheer Guntupalli. Please go ahead.
Hello, thanks for taking the question and Congratulations on great set of numbers. So just on your guidance of 40% plus year-on-year adjusted revenue growth for at least the next couple of years. So Akshant, what is giving you that confidence, especially in an economy where the nominal GDP growth is averaging just around 10%, you're talking about 4x GDP growth multiplier. That is number one. And number two, until last quarter, we are talking about consumption slowdown, discretionary slowdown, so on and so forth. And now we are talking about confidence of 40% plus year-on-year growth at least for the next couple of years. So this looks like almost a 180-degree turn in terms of our guidance aspiration. So what has driven that change? Is it entirely led by the strong performance that we had seen in this quarter?
Sudheer, Hi, Akshant this side, I'm wondering if your understanding of this 40% is only for food delivery because this is a guidance at the overall revenue level, which even in the last 4, 5 quarters, has been north of 50% year-on-year, right? So I think given we have a portfolio of business and while food delivery growth has been relatively muted last few quarters, which is what you're also saying, but at the same time, Hyperpure Dining Out and Blinkit have grown really well. And I think the message here that we want to give is that as a portfolio we will continue to grow at that pace while some business may grow faster than others.
Yes. Sure Akshant. I get your point. And to one of the previous questions, you have sort of not called out the growth. But 40% overall portfolio level growth does imply, let's say, food delivery growth of at least a 25% to 30% CAGR over the next couple of years, which seems to be a very, very big ask. So I'm essentially asking what is driving that confidence, both in the food delivery business compared to where we were 3, 4 months back.
If you look at this last 1 quarter, we've grown 11% on GOV terms sequentially and down 15% on a revenue basis for the food delivery business, right? So if you are doing that in 1 quarter, I think we can easily aim for a 25%, 30% growth on revenue on food of this year and the next. I think the assumption here is that the worst is behind us in terms of the demand slowdown that we saw. And from here on, incrementally, we should see that recover. And hence, we feel confident about being able to deliver this plan.
Sure, thanks for that color, and just one clarification. So this does not, in any way, include any of the future acquisitions that you may have in mind or anything of that sort, right? This is the pure organic number that we are talking about?
Just like-to-like.
Okay Akshant, thank you so much and congratulations once again for brilliant set of numbers.
Thank you Sudheer.
Thank you, next question is from the line of Mr. Mukul Garg from Motilal Oswal Financial Services. Please go ahead.
Hello.
Hi Mukul.
Hey, great quarter, guys, congratulations. Just a couple of questions. First, on the take rate during this quarter, I know this came up earlier also, but can you just help understand what steps were really undertaken this quarter was action you have in the past mentioned that incrementally taking up that take rate would be a lot more gradual. But [indiscernible].
Hi Mukul are you online? It seems like we have some sort of technical glitch, we can circle back to Mr. Garg later. In the interim, next question is from the end of Mr. Vivek Maheshwari from Jefferies. Please go ahead.
Hi, am I audible?
Yes, please go ahead.
A couple of things. First, on the food delivery, Akshant, that's what the previous participant asked. When we talk to QSR companies on the delivery side, their outlook is not as buoyant as positive as, let's say, you are. Is there a difference between, let's say, independence versus, let's say, change restaurant? Is there any such trend which is underway, which is why, let's say, your outlook is far positive as compared to the QSR folks?
Yes, so I think as we mentioned in the past, QSR contributes single-digit percentage point of our business overall. So most of our business on our platform happens through smaller restaurants and then a few outlet chains. So yes, at least as far as our business is concerned and the data that we are seeing, we feel there's no reason to believe that we should not be able to grow well from here on, right, at least on a year-on-year basis.
Okay And given the present section, I'm sure you would be interacting with those restaurants given where the food inflation is , honestly, I don't know beyond QSR as much. But shouldn't there be a bit of a stress that restaurant should be facing right now given the input prices have actually hardened quite a bit.
This is actually quite contrary to that. A lot of small restaurants, given the lack of growth in their business in the last 6, 9 months, we are seeing spending aggressively on ad sales on our platform to grow, right? And that trend is what has also led to a part of the take increase that a couple of you have asked us on this call in the past. So yes, I think the prices are going up, there's inflation, but we've seen the small restaurants take up menu prices and along with that spend on ads to get growth, and it seems like it's working for them.
Okay. Got it. The second point on food delivery margins, again, Akshant, 2.5%, and there has been obviously a dramatic improvement. I don't think most were believing when you first highlighted those things. But from here to, let's say, a journey to 5%, should that be more moderate? And through the course of the year, will we see more gains as we go forward?
So hard to predict the exact path Vivek. I think we'll play it by the year. It's a highly competitive market. There are multiple variables at play here, including the demand seasonality and competition. So I think we feel confident of getting there in a few quarters, but exactly from here on, whether it's going to be linear or not, it's hard to say right now.
Okay. Got it. And on the quick commerce Blinkit site, you have mentioned about 100 net store additions this year. What does that signal, these 100 stores are essentially you going into newer towns and cities. Is that what it is? Or this will be primarily in the existing locations and the fact that you have been pruning down the stores. And now that FY '24, you're guiding for 100 stores. So what has driven this change, I was expecting at some point, but FY '24, 100 additions seems that you are far more confident over here?
Hi Vivek, Albinder here, so most of the new store additions which we are guiding for is going to be in our existing geographies. A lot of this is being driven by the fact that we have polygons, which we are serving with existing stores that are reaching fairly high order numbers and reaching maturity, and we still see a lot of headroom for growth in those localities. So a lot of this growth is going to come from store expansion of our network within our existing geographies itself. We are obviously cautiously expanding into new geographies as well, adding some more flavor and variety into the kind of neighborhoods that we serve in the cities that we serve, including some Tier 2 cities. But majority of the 100 store expansion that you'll see come from high confidence polygons where we already have significant volumes.
Interesting. And last question, more philosophically, your letter talks about dining out or going out as a separate app. And you have again mentioned about the brand. But in this quarter also, 7% of GOV, let's say, comes from dinning out, do you really need a separate app? And is it worth it given that you already have a brilliant franchise with Zomato app, why put it separately? Have you done any study on this, which says that it would be better if you pocket in a different app? I can understand Blinkit because the traffic was always there in Groffers and that's why you probably want it to continue. But putting it separately, does that really help?
So Vivek, right now, just to clarify, by the way, we are not saying that this business will not be on the Zomato app even if we have a separate app., right? So I think it's an idea we are experimenting with right now. And even if we do that, dinning out will continue to remain on Zomato app, right? And we'll then see what we learn from that and whether that's the separate new app sales or not. So I think that's all up for experimentation at this point. We don't have a very firm point of view on that.
Okay, thank you and wishing all the best.
Thank you, next question is from the line of Mr. Ashwin Mehta from AMBIT, please go ahead.
Hi, can you hear me?
Hi Ashwin.
Hi, Akshant, thanks for the questions, congrats on a good set of numbers. So the first question is in terms of take rates. So we've seen almost a 200 [indiscernible] increase [indiscernible] over the last year. How much more scope do you see in terms of increases there? And then the second one is in terms of Blinkit wherein if you can give some color in terms of advertising pickup in Blinkit and how should that affect the take rates in Blinkit?
Yes. So large part of the take rate increase on the food side that you're talking about Ashwin is because of the growth in ad sales that we have seen. And as I mentioned in response to the previous question, we are seeing more and more restaurants wanting to spend on our platform to market their business and grow and that trend seems to sustain and continue for now. So we don't know till what level can this add sales revenue growth for us.And equally, I think likewise, on the Blinkit business, we've seen ads as a decent driver of or a meaningful driver of revenue expansion, top line expansion for Blinkit. And the journey there is much less mature than it is on food, and we believe that there are meaningful gains to be made on ad sales on the Blinkit business, and which would drive a large part of our progress to profitability from here on.
Okay. And just one more. Have you seen any impacts until now of the floods and some of the disruptions that have happened, especially in North India, for that matter? Any impacts that you see as you get into the next quarter?
Yes Ashwin, so I think these events do have a local impact on our business. Even for example, in Gurgaon, we've had some local issues last few days, and that has impacted our ability to service some of our customers in a few neighborhoods. So I think that impact, as you all mentioned also, was there in the last couple of months because of one timely heavy rains. So we've sort of navigated all of that and that did have an impact on the growth of the business over the last couple of months.
Okay. Thank you and all the way.
Thank you, next question is from the line of Mr. Nikhil Choudhary from Nuvama Equities. Please go ahead.
Hi, thanks for the opportunity and congrats on such a good set of numbers. First is on the 100 store increase for Blinkit and what Albinder clarified that it's primarily in the existing geography. So is it safe to assume the GOV, which is about 620,000, 625,000 per store, that would be a steady-state number given you are increasing the store count in existing geography? And why I'm asking this. One of your large competitor mentioned that GOV for them is still higher. So any clarity there?
Hi Nikhil, I think the GOV per store that we displayed, I think it depends more on whether we open a lot of new locations and whether we are opening those new locations, and the kind of high geography in the high order density locations where we expect the demand to increase a lot faster. So it's hard to put a tack on whether it will go up, go down a little bit and then come back up. I think that depends a lot on a number of factors, which includes pace of store opening and also the quality of the polygons in which we are opening those stores.
Sure, second question is regarding the employee cost as a percentage of revenue. We have seen it decline by more than 1,000 basis points in the last 1 year. And obviously, some of it is because of the synergy between the 2 platform, Blinkit and Zomato, which you mentioned and also due to overall decline in supply side challenges. What would be the steady state as a percentage of revenue employed cost would be, anything you are targeting?
So I think we feel, at this point, the organization is rightsized for the businesses that we have. And as I mentioned, September quarter is when the impact of annual appraisals will also impact that cost and it should go up from here. So here on, I think it should grow at some multiple of inflation. We don't expect it to change meaningfully either way.
Last question on what you mentioned that 30% of your GOV is coming from Zomato Gold. So any data point you can provide in the last quarter, you commented that AOV of Gold on lesser, because when people are ordering using the same account within the family, any color how basically the behavior of gold member versus the non-gold?
Nikhil, Kunal here, I don't think we mentioned that the EOVs were lesser. What we mentioned is the NPUs got impacted to some extent. Multiple individual users in the same family were ordering from the same account, right? So we don't see any major shift in the position that we saw even earlier. So EOVs are slightly higher than normal AOVs and the frequency of ordering, of course, is significantly higher. Part of that could be because of clubbing of orders, but part of it is also genuinely because there are free delivery benefits and other benefits.
Sure. That's it from my side. Thanks for the opportunity and good luck for the next period. Thank you.
Ladies and gentlemen, in the interest of time, we will now take the last 1 to 2 questions. The next question is from the line of Mr. Dipesh Mehta from Emkay, please go ahead.
Thanks for the opportunity, two questions. First of all, just want to get sense about how inflation and impact our business across segment. So if you can give some sense about how one should look revenue impact and margin impact food inflation as well as overall inflation. Second question is about Hyperpure business. If you can provide some sense about how many restaurant partners, let's say, we are now supplying the ingredient. And in terms of percentage of supply sourced by them, how it has moved, let's say, your bakers now, if you can provide some color, thanks.
Hi Dipesh, Kunal here. So I think I'll take the first question first. So like Akshant mentioned this now as well, yes, food inflation is impacting restaurants, but because their sales are getting impacted, they are also ending up spending more on advertising and trying to grow the business. So I think overall, yes, there is some stress, but I think they're also taking the right initiatives to ensure that growth continues on the platform. I think this inflation being up and down will be a characteristic that all businesses have to deal with, and they are also dealing with.So that's on the inflation front. Your second question was around Hyperpure, and so over there, look, like we pointed out in the shareholder letter, one of the initiatives that we took up over there was to increase our minimum order value for restaurants to order on the platform. And that resulted in some churning out of the small unprofitable restaurants who were not meeting that new model criteria. And to that extent, yes, there was some churn, but I think overall, it resulted in an increase in revenue because restaurants that were on the fence were able to increase their average order values and that also had a positive impact on the profitability of the business.
The question is about the sourcing changes in terms of percentage of sourcing. What used to happen versus now the same restaurant partner, if you can give some color?
Yes, the same restaurant. There is going to be the gradual increase in wallet share also so that we will continue to see, new restaurants start with a few commodities and then eventually, as they build trust, they continue to expand the basket that they order from Hyperpure. So that's a gradual process and that you're seeing in our current numbers as well.
Next question is from the line of Mr. Manish Poddar from Motilal Oswal AMC. Please go ahead.
[Indiscernible] thanks for giving me the opportunity. So I have 3 questions. One is, if you could call out what is the sort of investment which is done on Gold and my estimate it's somewhere in the high single-digit number. So what is the sort of investment up here? And where do you think this will normalize? So would this number be INR 3, INR 4. I'm just trying to understand, it's a per order basis, whenever it is, FY '25, '26, I'm just trying to understand where does the summer stack up at steady state?
So Manish, hard to say that at this point. I think in our business, there are pockets where we have to invest at different periods of time and then sort of a gap depending on how the market is changing, how the consumer habits are changing and how the competition is behaving. So at this point, I won't be able to comment on a specific guidance on how much are we investing here and where that is likely to move going forward.
Okay and any thoughts on this platform fee, which is being levered by the peer set, do we want to roll out, have we tried in certain micro markets, just thoughts around that?
Yes. So it's a business called Manish. So we are aware about that, and I think we'll take a call if you think it's the right thing for the business. At this point, we haven't done that. I mean there is no platform fee on our platform.
Okay. And then third bit is if you look at the restaurant count, even the last 2 quarters, despite cutting down on the cities or the [indiscernible] in the food delivery, the restaurant count has increased. So have we added any new categories or are there new restaurants coming out? Can you just help me understand what is happening up there?
Yes. So Manish, we are largely the new restaurants. I think that we continue to onboard every month, every quarter. So the number you see in our disclosure is the net number of restaurants. But every quarter, there are a number of restaurants which shut down and a lot more open up on new restaurants come up, right? There are also pockets in the country where we are not adequately penetrated in terms of having existing restaurants on our platform. So that also adds to the number of restaurants. So I think it's a combination of all of this, which is right now leading to the moderate uptick in the number of restaurants that you see.
So there's no material new categories, let's say, which has got added as such?
No, no. There is not.
Okay. And just one last one, if I can. So in terms of fleet, I think the delivery riders are getting cross-utilized I think in some micro markets across different segments, let's say, in terms of utilizing it with either your holding company or with other entities. Just any sense if you can give me qualitatively, how does this benefit in terms of, let's say, delivery cost or any sort of sense? There can be 20% savings on that over 3 years? Just any sort of understanding on that will be helpful?
HI Manish, this is Kunal here. This is not a specific strategy that we are deploying. We don't intend to necessarily use our fleet or delivery partner network for and open it up to other sort of use cases or other entities we use. So at this point, it's not part of our strategy.
Okay. Thank you so much and again [indiscernible] thanks.
Thank you, next question is from the line of Mr. Niket Shah, please go ahead.
Yes, thanks for the opportunity once again for the entire team. I just had 2 questions. One is in the press that you did highlight about Blinkit exited EBITDA in the next 4 quarters. Would it be possible for you to share the broad levers? Or how are you really looking at it, which other broad levers to really move towards profitability?And also in the past, you did highlight when food delivery used to be a loss-making business about how you think about food delivery business from an EBITDA standpoint to reach to about 3% to 5% EBITDA margin over the medium term. It now looks really achievable, but would it be possible for you to share the similar kind of a thought process for Blinkit over the medium to longer term? And the second [indiscernible] you did allude that on the ad side, you've seen significant growth, which is obviously more your take rates higher. Would it be possible for you to quantify? Is it volume led, pricing-led? Or have you taken pricing increase on the ad side?
Niket, so I will take the first question. So looking at our Blinkit business, I think our aim is to get to adjusted EBITDA positive over the next 4 quarters. And I think the levers for doing that what we've been talking about through the calls earlier as well that we do see a lot of operating leverage in this business.We do see a lot of expansion of the wallet share of customers because they're now starting to buy a lot more things than just the core grocery categories from us . And I think that leads to both order growth, revenue growth and obviously, we're able to harness the operating leverage that exists in a high fixed cost model like ours. So I think there's nothing of the ordinary in terms of how we think we will get to just EBITDA positive. And of course, there will be innovations along the way that we hope that we continue to make to get that denture. Do you want to take that one?
So on the [indiscernible] wants to answer your question, I think it's largely been volume-led. We haven't taken a really mute a price increase during this time.
Got it. So that lever does remain with you at some point of time.
And just one more final question, if I may squeeze in. Is it possible for you to call out a range of what has been the drag because of Zomato Gold in this quarter?
No Niket, I would not want to share that information as it's sensitive from a competitive standpoint.
No worries, best of luck and congrats once again, thank you.
Thank you, ladies and gentlemen, we will now conclude this conference call. Thank you for joining us, and you may now disconnect your lines.