Scribd
Upload
47 views4 pages

Zepto's Strategic Leap - Restructuring For IPO

Zepto, a fast-growing player in the hyperlocal delivery market, is preparing for an IPO in 2025 by restructuring its business model and merging with its Indian subsidiary. The merger is expected to be tax-neutral for investors in India and has no capital gains implications in Singapore. Additionally, Zepto has established a new subsidiary, Zepto Marketplace Private Limited, to streamline operations and enhance competitiveness in the quick commerce sector.

Uploaded by

Abhik Tayal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
47 views4 pages

Zepto's Strategic Leap - Restructuring For IPO

Zepto, a fast-growing player in the hyperlocal delivery market, is preparing for an IPO in 2025 by restructuring its business model and merging with its Indian subsidiary. The merger is expected to be tax-neutral for investors in India and has no capital gains implications in Singapore. Additionally, Zepto has established a new subsidiary, Zepto Marketplace Private Limited, to streamline operations and enhance competitiveness in the quick commerce sector.

Uploaded by

Abhik Tayal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 4

Background

Founded with a vision to revolutionize the hyperlocal delivery space, Zepto has rapidly grown into a
major player in the quick commerce segment. With its focus on ultra-fast delivery and a robust
operational model, it has carved a niche in the competitive landscape.

Now, as it gears up for an IPO in 2025, they are taking decisive steps to streamline its structure and
enhance its market position.

Reverse Flip for IPO Readiness


Kiranakart Technologies Pte Ltd., based in Singapore, has successfully secured approvals from the
Singapore authorities1 and India’s NCLT to merge with its Indian subsidiary, Kiranakart Technologies
Private Limited.

This reverse flip is a crucial step as the company gears up for its much-anticipated IPO launch in
2025.

What does it mean for investors from a tax perspective?

Singapore: It is unlikely that this merger will have any capital gains implications for the investors as
Singapore doesn't generally tax capital gains

India: The transaction is expected to be tax-neutral under Indian tax laws. The cost of acquisition
and the holding period for the shares of the Singapore Hold Co. i.e. Kiranakart Technologies Pte Ltd
should carry over to the shares of the merged Indian company, received pursuant to merger.

RBI approval to be obtained for this merger?

No prior RBI approval will be required for such in-bound merger as it fulfils the conditions mentioned
under the Foreign Exchange Management (Cross Border Merger) Regulations 2018

1
https://timesofindia.indiatimes.com/technology/tech-news/zepto-gets-singapores-approval-set-to-become-an-indian-co
mpany-with-/articleshow/116950996.cms
Business Model Rejig: Introduction of Zepto Marketplace
Private Limited
As part of its pre-IPO optimization, Zepto has restructured its business model by incorporating a
wholly owned subsidiary, Zepto Marketplace Private Limited, under Kiranakart Technologies Private
Limited. Key points to note here as per publicly available data2:

1)​ Transfer of IP Ownership: The intellectual property rights for the Zepto app and website,
previously owned by Kiranakart Technologies Private Limited, appear to have been transferred to
Zepto Marketplace Private Limited. Consequently, Geddit Convenience Private Limited, Drogheria
Sellers Private Limited, and Commodum Groceries Private Limited, which previously held licenses
to the “Zepto” app and website from Kiranakart Technologies Private Limited, will now license the
same through Zepto Marketplace Private Limited.

2)​ Market Comparability: By adopting this structure, the business model aligns more closely with
established players like Swiggy Instamart and Blinkit (Zomato).

These developments underscore Zepto’s commitment to streamlining its operations and solidifying
its market position as it prepares to enter the public domain. The strategic nature of these moves
reflects the ambition to not just compete but lead in the fast-paced world of quick commerce.

Please refer to the comparative structure outlined below for a clearer understanding.

2
https://www.moneycontrol.com/news/business/startup/zepto-streamlines-structure-ahead-of-ipo-with-new-marketplace-
entity-12901986.html
Get in touch with us
We simplify complex legal and financial challenges by offering a range of services, including Virtual
CFO, Legal Support, Tax & Regulatory, and Global Expansion assistance.

Our goal at Treelife, is to provide you with peace of mind and ease in business for startups, investors,
global businesses and accelerators/incubators.

We are Problem Solvers. And take Accountability.

[email protected]​ ​ ​ ​ Follow us on

+91 99301 56000 | +91 22 6852 5768

www.treelife.in

​ ​ ​ ​

Mumbai | Delhi |
Bangalore | GIFT City

Disclaimer: The above is for information purposes only and does not constitute advice or a legal opinion and are personal
views of the author. The possibility of other views on the subject matter cannot be ruled out. By the use of the said
information, you agree that the Author / Treelife is not responsible or liable in any manner for the authenticity, accuracy,
completeness, errors or any kind of omissions in this piece of information for any action taken thereof.

You might also like