Zomato, the leading foodtech company, has announced a major expansion of its Employee Stock Option Plan (ESOP) by allotting nearly 1.2 crore stock options to eligible employees.
In an exchange filing on October 2, Zomato’s board, led by CEO Deepinder Goyal, approved the issuance of 1,19,97,768 stock options under various ESOP schemes, aimed at retaining top talent and attracting new employees from the competitive startup ecosystem.
The stock options will be distributed under two primary schemes: 116 options from the Foodie Bay ESOP 2014 and 1.19 crore from the Zomato ESOP 2021.
Each option is convertible into one fully paid equity share with a face value of INR 1, and employees can exercise these options within ten years from the date of vesting or twelve years from Zomato’s public listing, whichever is later.
Notably, the newly allotted shares will not be subject to a lock-in period.
The announcement comes amid a positive performance for Zomato in the market, with shares opening at INR 268.70 apiece on the Bombay Stock Exchange (BSE).
The cumulative value of the newly allotted shares amounts to approximately INR 322.38 crore.
This is not the first instance of Zomato introducing fresh ESOPs this year.
In August, the company allotted over 35.17 lakh equity shares, highlighting its ongoing strategy to incentivize and retain talent in a competitive industry.
Zomato also recently received shareholder approval to implement a new ESOP plan, the Zomato ESOP 2024, which aims to grant 18.26 crore employee stock options.
Zomato’s performance metrics have been robust, with a substantial year-on-year increase in profit margins, particularly driven by growth in its quick commerce vertical, Blinkit.
For Q1 FY25, Zomato reported a consolidated net profit of INR 253 crore, a significant rise compared to the previous year, while revenue from operations soared 74% year-on-year to INR 4,206 crore.
In addition to its employee retention strategies, Zomato is expanding its business through acquisitions and new service offerings.
The company has recently acquired Paytm’s events and movie ticketing subsidiaries and launched a ‘Book Now, Sell Anytime’ feature for live event tickets on its app, aimed at enhancing user experience.
However, Zomato faces ongoing challenges with tax authorities. Last month, the West Bengal GST department issued a demand for over INR 17.70 crore in taxes and penalties, following similar fines levied in Tamil Nadu and West Bengal earlier in August.
