Section 1 - Overview

Zepto is an Indian Quick-Commerce platform that promises to deliver daily essentials within 10 minutes. Zepto has pan India presence across more than 20 metro cities. It operates through 1100+ dark stores. It has multi-channel revenue streams and constantly working towards expansion. Zepto commands around 21-29% of market shares, next to Blinkit (45-50%). Growing investor interest in Zepto’s unlisted share market and potential IPO reflects strong expectations around its future listing plans.

Section 2 - How the company makes money?

2A -Operational Model

Zepto operates on four wheels: Zepto application/website, Dark Stores, Zepto Café, Zepto Atom. These four verticals drive the entire revenue of zepto. 

• Zepto App: Zepto application provides access to the platform that connects customers and dark stores. People can access platform via mobile application and website. Once logged in, they can place orders, the curated basket then packed in nearby dark store (small warehouse filled with daily essential, packed foods, grocery, cosmetics, electronics and locally preferable goods) – then delivery partner picks the order and delivers at the door step. Zepto has more than 45K catalog of goods listed on its app and still expanding. They also use LLM to personalize the experience of users, it identifies the pattern, purchase behavior and then recommends accordingly on your next visit. Zepto promises to deliver within 10 minutes, which is made possible due to strategic locations of dark stores that are located within 1.5 km range. Zepto also plan to expand into diagnostics where they provide diagnostic services at your doorstep within 60 min and commits to provide 6-hour turnaround for reports. 

• Dark Store: These are micro warehouses of 1.5-2k sq. ft. located strategically within 1.5 km range of serviceable area. They are packed with daily essentials goods. An average store can ship 2500 orders per day. It operates more than 1100 to 1200 dark stores across India and processes over 1.7 million orders. These dark stores are replenished by mother warehouses. Since the consumer preference changes from location to location each store carries preferred goods accordingly, this keeps the wastage minimized and improves turnover. Leveraging technology is at the heart to make the model efficient. Zepto uses warehouse-management software that maps optimal picker paths, forecasts demand at the PIN-code level and re-optimizes store layouts around fast-moving SKUs.

• Zepto Café: This vertical of the zepto involves privately labelled fresh breakfasts, brewed coffee, other beverages, snacks, and other in demand foods at the doorstep. They have set up dedicated kitchens inside selected stores. They offer 140+ items under Zepto café. Zepto café was launched in April 2022, earlier it was embedded in main application but later launched its own app in Dec 2024.

• Zepto Atom: This is a subscription based analytical platform for consumer brands. Zepto atom provides insight into sales and customer behavior at PIN-code level. It shows you real-time dashboard that updates every minute on metrics such as units sold, impressions, conversion rates and other metrics. 

2B -Revenue Model

Zepto runs on multi revenue streams:

• Revenue from App/Web: Revenue from this comes aggregates from three further sub-steams:

  • Product Sales: Zepto procures products in bulk from brands at wholesale price and sell at retail prices, keeping the 10-20% of margin on standard groceries and FMCG products. As of mid-2025, annualized GOV of the company stands tall at $4billion.

  • Delivery Charges: Orders below the value of Rs. 149 attracts applicable delivery fees. The min bar of 149 has been set to encourage higher value orders.

  • Monthly Subscriptions: To reward loyalty and provide preferential experience for customers they have Zepto Pass, which is a monthly subscription plan that gives you unlimited free delivery, upto 20% exclusive discount. Approximately Rs. 40 lakhs of monthly revenue come from zepto pass subscriptions. 

  • Ad-Revenue: Zepto’s in app/web advertisement vertical operates at massive scale. It commands over 60 million active users monthly – a highly sought after urban and convenience driven audience. Brands advertising on Zepto:

    • FMCG & Packaged Foods: HUL, Knorr, Mondelez, Reckitt Benckiser, Coca-Cola and Hellmann’s.

    • D2C & Personal Care: Cerave, Blue Heaven Cosmetics, Park Avenue (Godrej), and Ambrane.

As of April 2025, approx. $200M was annualized advertising run-rate.

• Zepto Café: This is the private labelling arm of Zeto, where it makes money by selling in-house generated high margin food & beverages to customers. On an average $110M is contributed by Zepto café. 

• Zepto Atom: This brings the subscription income by providing analytics platform to consumer brands. 

Section 3 – Competition

Blinkit

Blinkit is the largest competitor holding 45-50% of market share, it was originally founded in 2013 as Grofers. It has presence in more than 150 cities and operates under the same quick commerce segment. The company has more than 7000 products under its catalogue such as fresh produce, dairy products, bakery items, meats, snack and etc. It boasts to specialize in ultra-fast delivery – within 10 minutes. As of November 2025, Blinkit had raised $1.3 billion from investors like Sequoia Capital, SoftBank, and Tiger Global, in a mixture of equity and debt.

In June, 2022 Blinkit was acquired by Indian food delivery company Zomato for $568 million. Blinkit leverages Zomato’s food delivery footprints, payment gateway and brand recognition to expand and capture market share. 

Instamart (Swiggy) 

Swiggy Limited which is an Indian Publicly listed company operates in food delivery and Q-commerce industry, headquartered in Bengaluru. Formerly started as e-commerce company called Bundl, facilitating courier services within India. Later entered into food delivery and expanded from Bengaluru to 8 Indian cities. Later in August 2020, Swiggy started instant delivery called Instamart using dark store network. As of now it is operational in more than 100 Indian cities, servicing with 1200 active dark stores. In FY26, it has crossed INR 4000+ Cr in topline, from FY24 topline has exploded 250%, Average order value scaled from 8100 Cr to 28000+ Cr. Like competitors, Instamart also expanded its catalog and included electronics, apparel, and other home essential, however rapid expansion initially squeezed margins down to -5.6%, the segment is still struggling. Swiggy Instamart commands 23-27% of market share. 

Big Basket 

Big Basket is an Indian E-commerce, Online shopping and quick-commerce subsidiary of Tata Digital. It was founded in December 2011 and received initial funding of $10M from Bengaluru private equity investor – Ascent Capital. After surviving multiple market cycles and receiving multiple fundings, Big Basket is now gaining traction and competing in Q-commerce segment. In June 2025, launched 10-minute food delivery service. It has widest SKUs ranging between 30,000-50,000. They have presence in more than 40 cities – deep tier 2/3 reach. Order value is highest among the competitors - INR 800-1200. 

Industry Analysis

Tailwinds

As of 2025-26, Quick-Commerce market of India sits at the GMV of $7-$8 billion. Jan 2026 recorded a GMV of INR 11000 Crore. There is a consolidated oligopoly, where Blinkit owns more than 50% of the market share, followed by Zepto and Swiggy Instamart, other players such as Flipkart and Amazon, Reliance Retail, Big Basket are also expanding aggressively. 

Between 2021-2025 the market exploded with CAGR of 110-130%. In Fy22 GMV of the segment was $0.5B then climbed to $1.6B in FY 23 then touched $3.3B by FY24 and skyrocket in coming year – FY25.

The industry is witnessing a penetration rate of 2.7-4% that is higher than western countries but much lower than China (25%). 

As per the reports of Bain & Company India’s Q-Commerce GMV is expected to scale to $35B by 2030. 

Majority of consumers live in urban areas – metro cities such as Delhi, Mumbai, Gurugram, Bengaluru, and others. With the projected penetration rate, the market is moving towards tier 2 cities due to increased digital spending of middle-class consumers.

European and American markets are scattered as compared to India. GenZ and GenX are driving the growth and establishing hyper-local buying culture that millennials are adopting too. 

Increased digital spending plays a major role in facilitating seamless Q-commerce growth.

As of 2025, India’s total addressable market for online grocery is expected to cross $24 billion.

Headwinds

• While Q-commerce industry in India is scaling massively, the model failed in western countries. Companies like Gorillas, Buyk, Fridge No More, Jokr and other failed due to weak unit economics in addition to the following reasons:

  • High delivery cost and thin margins

  • High cost of operating dark stores

  • People are less than 5 min walk away from supermarket and shopping complex

  • Post pandemic – funding freezed – companies ran out of cash. 

• FDI Violations: DPIIT and CAIT regularly audits Q-Commerce structures. As per guidelines, any e-commerce platform with foreign funding is strictly prohibited from owing inventory and manipulating product prices, doing so may attract severe penalties.

• Public Nuisances: Many RWA’s are filing complaints and legal notices regarding blocked pavements, parking congestions and noise created by hundreds of riders gathering.

• Urban Zoning: To deliver the orders within 10 minutes, dark stores are required to be proximate region to residential areas. Many dark stores operate from basements, residential garages- in response municipal bodies like GHMC in Hyderabad, KMBR in Kochin have initiated legal lawsuits for running commercial warehouse in strictly residential areas.

• Labor Laws: Currently delivery partners work as individual contractors/freelancers paid per delivery. If Indian labor laws proceed to implement code of social security and state level gig worker protection then companies need to classify their delivery partners as employees and provide for their health insurance, pension plans, accident coverage and other allowances as applicable – increasing delivery cost to rise by 15-25%, stressing the unit economics. 

• Food Safety and Hygiene Lapse: FSSAI and state FDA have zero tolerance policy for violation of food safety standards and un-hygiene. For instance, Maharashtra FDA has shut down the facility of a major player for hygiene violations. Hence, dark stores are required to comply with standard food safety measures, any violations may result in instant facility shutdown.