Zomato Hikes Platform Fees Amidst LPG Supply Crisis

Zomato has increased its platform fees by approximately 20%, now charging ₹14.9 per order, excluding GST. This adjustment comes as the food delivery sector faces challenges due to an ongoing LPG shortage impacting restaurant operations across India, according to Inc42.com.

The fee hike, implemented across all of Zomato’s operating markets in India, follows a previous increase to ₹12.5 during Ganesh Chaturthi in Mumbai last year. Rival Swiggy has been charging nearly ₹15 inclusive of GST since August, while magicpin charges ₹14.2 per order.

Introduced initially in 2023 at ₹2, the platform fee has steadily risen, contributing to improved unit economics for food delivery companies. The current increase coincides with supply chain disruptions caused by LPG shortages, which have forced some restaurants to limit or halt operations. Rising crude oil prices are also expected to increase inflationary pressures and fuel costs for delivery operations.

Motilal Oswal, a brokerage platform, noted that the LPG disruption could cause a near-term decline in order volumes if shortages persist through March. The firm estimates Zomato’s Gross Order Value (GOV) growth at 15.3% and 18.0% in fiscal years 2026 and 2027, respectively, and Swiggy’s at approximately 20.2% and 17.3%.

Zomato’s parent company, Eternal, has seen its stock decline by over 13% in the past month and 16.4% year-to-date, reflecting the impact of geopolitical tensions and the LPG supply crunch. Despite these challenges, Zomato’s shares closed 1.49% higher at ₹232.3 on the BSE today.