Zomato Q4 Results Preview: Steady earnings on cards after solid few quarters

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Online food delivery platform Zomato is expected to put up a steady show in the January-March 2024 period after a solid last few quarters.The company is likely to see up to 75% year-on-year (YoY) growth in consolidated revenues , driven by healthy food delivery and hyperpure revenues. Sequential revenue growth is seen in the range of 3-9%. The food delivery app will report its earnings on Monday, May 13. Net profit for the fourth quarter is seen rising up to 48% quarter-on-quarter (QoQ). The company had posted a loss of Rs 187 crore in the last year quarter.In the preceding December quarter, Zomato's net profit jumped nearly 4x (283%) QoQ to Rs 138 crore. Revenue from operations in the third quarter increased 69% YoY to Rs 3,288 crore.Here's what to expect from Zomato's Q4We expect 4QFY24 revenue growth to come in at 65% YoY driven by 41% YoY growth in food delivery revenues (25% YoY growth in GMV and 60 bps YoY take rate expansion), 92% YoY growth in Hyperpure revenues and 102% YoY growth in Blinkit revenues. Our food delivery GMV growth assumption implies a 3% sequential revenue decline on account of seasonal weakness expected in 4Q.We model 20 bps QoQ expansion in food delivery CM to 7.3% in 4Q. This drives a QoQ increase in segment EBITDA despite lower GMV. We also expect a sequential reduction in losses in the Blinkit business driven by higher throughput of existing stores and quicker scale-up of new stores.We estimate 9.4% QoQ/74.9% YoY revenue growth for consolidated business in Q4FY24. Adjusted revenue of Food delivery business to grow by 6.5% QoQ/40.9% YoY, driven by volume growth. We expect consolidated EBITDA margin to improve by 110 bps QoQ.