Amid Intense Selloff, Zomato, Policybazaar Record All-Time Lows

Intense Selloff In New-Age Tech Stocks; Zomato, Policybazaar Record All-Time Lows

SUMMARY

Foodtech major Zomato tanked 11.37% on the BSE to INR 47.55, falling under INR 50 for the first time since its listing last year

Policybazaar also touched an all-time low of INR 497.75 intraday on the BSE, and ended nearly 4% lower

Shares of Info Edge also fell 1.98% on the BSE to INR 4,022

It was a rough day for new-age tech companies on Monday (July 25) as their shares took a beating on the bourses. Foodtech major Zomato tanked 11.37% on the BSE to settle at INR 47.55, the first time the stock closed under INR 50.

On Friday, the stock opened at INR 52.65 and plunged to an all-time low of INR 46 intraday. The startup closed the day with a market capitalisation of INR 37,439.23 Cr.

The intense selloff was attributed to expiration of the mandatory one year lock-in period for Zomato’s promoters, company employees, founders, among others. The company’s shares listed on the bourses on July 23 last year.

Previously, pre-initial public offering (IPO) investors could not offload their shares in a company for a period of one year after its listing. The Securities and Exchange Board of India (SEBI) has now reduced the time frame to six months.

The matters for Zomato have been complicated by a higher cash burn and addition of loss-making Binkit to its portfolio.

Zomato shares are currently trading 71% lower than the record-high of INR 169.10 which they achieved in November last year. In the last one month alone, the shares of the food delivery company have fallen by more than 27%.

The downward trend was also witnessed in other new-age tech stocks. PB Fintech, the parent company of fintech player Policybazaar, also fell nearly 4% on the BSE to INR 499.25.

The shares of the fintech company touched an all-time low of INR 497.75 intraday on the BSE. Its market capitalisation stood at INR 22,441.28 Cr at the end of the trading session.

On Friday, Policybazaar informed the BSE that its IT systems had suffered a cyber attack, and said that there was no significant exposure of consumer data.

Info Edge, which owns a 15.23% stake in Zomato and 13.3% in Policybazaar, also bore the brunt. The shares of the company fell 1.98% on the BSE to INR 4,022.

The benchmark indices NSE Nifty50 and BSE Sensex ended the day 0.53% and 0.55% lower at 16,631.00 points and 55,766.22 points, respectively.