Popular food delivery brand Zomato has granted nearly 12 million stock options under its employee stock option plan (ESOP). In an official filing, the company stated that 11,997,768 stock options had been secured for the employees under its ESOP 2014 and ESOP 2021 schemes.
The stock options are estimated to be worth around Rs. 330 crores considering Zomato’s current share price of Rs 275.2. It aims to boost employee motivation by offering long-term wealth-creation opportunities. Zomato’s employee stock offering comes as Swiggy prepares for its highly anticipated IPO. Swiggy, Zomato’s main competitor, is reportedly planning a ₹5,000 crore IPO, a notable jump from its initially proposed ₹3,750 crore offering.
Is this something big cooking, or has Zomato only done this for the good of its employees? Well, it is not clear yet, but what has come to light is Zomato’s significant year-on-year growth in its consolidated net profit to Rs. 253 crore. Revenue from the operations in the reported period increased by 74% YOY.
The company’s Nomination and Remuneration Committee approved the grant, allowing employees to exercise their stock options within ten years from the vesting date or 12 years from the company’s listing date.
Out of the total options granted, most belong to the ESOP2021 plan, and only 116 options are from the older ESOP, the 2014 plan. Each option is convertible into one fully paid equity share with a face value of Re 1.
Deepinder Goel, the founder of Zomato, is an innovative businessman who has raised the Company from nothing to a star. He always brings creative ideas to the table that grow the company and result in success. Probably, granting stock to employees is also part of business strategies that will foster both employees and business growth.
