Tale of the Tape 

Hola Amigos!

Bulls bounced back in the afternoon to recoup yesterday’s losses, as the Nifty (+0.6%) and Sensex (+0.5%) ended higher. Gains were seen across broader markets too as Midcaps (+0.7%) and Smallcaps (+0.9%) continued their three-day streak. 349 stocks in the NSE 500 were up. PS - tomorrow we’ll know whether the GST Council will approve the GOI’s tax cuts, so fingers crossed!

Except IT (-0.7%), every other sector ended in the green or flat. Metals (+3.1%) led the rally, followed by Pharma (+1.1%) and PSU Banks (+1%).

In today’s issue of the Daily Rip, we look at what Zomato’s platform fee hike means for investors and customers, unpack TBO Tek’s big acquisition, cover the top newsmakers and more.

Honourable Mentions:

Kotak Bank (+1%) is reportedly back in the race to acquire IDBI Bank, according to NDTV Profit. E2E Networks was locked in a +10% upper circuit after winning a Rs 177 cr order from the GOI’s AI mission.

Check out the NSE 500 heatmap:

Stock
Online Food Ordering Gets Expensive

After an insane discount war for years, Zomato has silently hiked its platform fee to Rs 12 per order (vs Rs 10 earlier). ICYMI - Swiggy did the same last month, bumping it up to Rs 14 for some high-demand orders. Investors are gonna love it, but customers will feel the pain. Here’s what you need to know.

The hike sounds small; just a couple rupees. But Zomato’s platform fee used to be Rs 2 per order back in 2023. That means we’ve seen a 6x raise in just two years. It also adds up in terms of scale. Zomato ships about ~2.5 million orders per day. A two rupee hike means it can make an additional Rs 45 cr in revenue per quarter. This is just the thing the company needs after burning a lot of cash in the quick-commerce segment over the last 6 months. Profits have dropped since Q2FY25 and this provides a decent cushion. 

FYI - platform fees are just the tip of the iceberg. Zomato recently started levying rain surcharges even for its premium Gold members who were earlier exempt. And let’s not forget their new Rs 50 VIP mode which ensures your food is delivered ‘faster’ by not clubbing it with other orders. That’s a classic scam that first makes service worse (by combining orders and delaying delivery times) and then charges for something that used to be the norm (one food order → one driver).

How do they get away with it? Mostly because food delivery is now a duopoly and if you don’t wanna go out, you have to depend on Zomato or Swiggy. But also because the companies know that higher platform fees DON’T result in fewer orders. Food delivery growth may be tapped out, but that doesn’t mean its existing customers can’t be milked for more!