New-Age Tech Stocks Bleed This Week As Broader Market Continues To Plunge

New-Age Tech Stocks Bleed This Week As Broader Market Continues To Plunge

SUMMARY

Twenty five of the 31 new-age tech stocks under Inc42's coverage fell in a range of 1.05% to a little under 16% this week

Shares of MobiKwik, IndiaMART, Unicommerce, Delhivery, EaseMyTrip and FirstCry touched fresh 52-week lows over the past week

In the broader market, Sensex fell 0.56% to 76,190.46 and Nifty 50 declined 0.48% to end the week at 23,092.20

The downward spiral in the Indian equities market continued this week as well, which resulted in new-age tech stocks continuing to remain under pressure.

Twenty five of the 31 new-age tech stocks under Inc42’s coverage fell in a range of 1.05% to a little under 16% this week.

The overall market capitalisation of the 31 new-age tech stocks plunged to $81.98 Bn this week from $87.98 Bn at the end of last week. 

MobiKwik emerged as the biggest loser for the second consecutive week, with its shares bleeding 15.59% to end the week at INR 397.80. The company’s share price touched an all-time low of INR 395 during the intraday trading on Friday (January 24). The stock got listed in December at INR 442.25 on the BSE, a 58.5% premium to the issue price of INR 279.

MobiKwik announced on Friday, after market hours, that the cofounder and CEO of its payments division, Chandan Joshi, had tendered his resignation with immediate effect due to “personal reasons and family commitments”.

This week also saw multiple other new-age tech stocks touch fresh 52-week lows. 

After announcing its results for the third quarter of the fiscal year 2024-25 (Q3 FY25) on January 21, shares of online B2B marketplace IndiaMART InterMESH fell to a 52-week low of INR 2,064.10 on January 22. The company’s shares recovered a bit to end the week at INR 2,082.50, still 8.78% lower from the last week. 

The company reported a 48% year-on-year (YoY) jump in its net profit to INR 121 Cr in the quarter, while revenue from operations surged 16% to INR 354.3 Cr in Q3 FY25. 

Brokerage JM Financial said that the sequential fall in the company’s paid subscription suppliers by 3.7K to 214K was a “big disappointment”. Despite this, it maintained a ‘BUY’ rating on IndiaMART with a price target of INR 2,450. 

“Ex-Covid, this was the first time IndiaMART reported sequential decline in paid subscription suppliers after going public. The drop was attributable to double whammy of weak gross additions (amidst management focus on improving supplier quality and adverse seasonality) and continued high churn in Silver tier customers. We expect the pressure on paid subscriptions to sustain in the near term, thus limiting meaningful upside to collections growth,” the brokerage said. 

Fintech major Paytm also released its Q3 numbers this week. While it managed to narrow its consolidated net loss by 6% on a YoY basis to INR 208.5 Cr, its revenue from operations slipped 36% YoY to INR 1,827.8 Cr. 

Following this, the company’s shares plunged 10.22% to end the week at INR 807.75. Besides the lukewarm financials, another development that fuelled the bearish sentiment was a report which said that the Enforcement Directorate (ED) was probing the fintech major, along with other payment gateways, in connection with a crypto scam linked to HPZ Token. However, Paytm, and the other companies, denied the allegations, but this still led to a near 9% decline in the Vijay Shekhar Sharma-led company’s share prices on Friday. 

SaaS major Unicommerce ended the week 10.78% lower at INR 141.60 after touching an all-time low at INR 141.25 during the intraday trading on Friday. With this, the company’s shares have now slipped 38.43% below its listing price of INR 230. 

Besides, shares of Delhivery, EaseMyTrip and FirstCry also touched fresh lows this week. Other losers this week included PB Fintech, Nykaa, Ola Electric, Swiggy, Zomato, among others.  

Meanwhile, Go Digit, TAC Infosec, RateGain, EaseMyTrip, MapmyIndia and DroneAcharya were the gainers this week, rising in a range of 0.14% to just under 8%. Of these, shares of cybersecurity firm TAC Infosec touched an all-time high at INR 1,697 on Friday. Its shares ended 6.07% higher this week. 

In the broader market, Sensex fell 0.56% to 76,190.46 and Nifty 50 declined 0.48% to end the week at 23,092.20. The benchmark indices have gone down nearly 3% since January 1. 

In its India Strategy Report 2025, ‘2025—the pricey paradise; cloudy skies’, BNP Paribas’ head of India equity research Kunal Vora said that the weak start for the Indian markets in 2025 is due to rising US bond yields which have led to the strengthening of the US dollar and FII selling. Besides, the weak earnings reports from listed entities for the December quarter have also been a cause of concern.

“Though DII holdings are rising, India is not immune to FII selling as FII holdings are still 1.6X that of DIIs. Locally, earnings growth has slowed across sectors as the benefits of the post-pandemic reopening and commodity tailwinds are now behind. Slowing corporate tax and GST collections could constrain the government’s ability to stimulate the economy while maintaining fiscal discipline,” he added.

Moving forward, Vinod Nair, head of research at Geojit Financial Services, believes that uncertainty surrounding Trump’s economic policies and high valuations may impact the stock market in the short term. He said that while the Q3 results are broadly in-line with expectations, they are not helping the market which is following the sell-on-news trend. 

“Key events, such as the FOMC meet and Union Budget, will influence market sentiment. While the FOMC maintains a hawkish stance, Trump’s push for rate cuts can add a positive undertone in the future. Expectations for the Union Budget remain subdued; however, the conclusion of this major event without any negative surprises could help alleviate market concerns,” he added. 

Further, he opined that the Indian market seems to be in the final phase of consolidation. He highlighted that India’s GDP growth is expected to accelerate and expected to increase to 7% in FY26 from 6.4% in FY25. In line with this economic improvement, earnings growth for Indian companies is also expected to revert to the long-term historical average of 15% by FY26. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week.

A Tough Week For Zomato

Shares of foodtech major Zomato plummeted 13.25% this week to end at INR 215.80. The downward trend in the stock began on Monday (January 20) after the company reported underwhelming financial numbers for Q3 FY25. Despite its top line growing 64% YoY to INR 5,405 Cr, its net profit dipped 57.2% YoY to INR 59 Cr.

A slow down in the food delivery segment and rise in the loss of quick commerce vertical Blinkit dragged down the foodtech giant’s profit.

For its core food delivery business, almost all key metrics – from gross order value to average monthly transacting users – were down sequentially. 

Brokerage ICICI securities pointed out that Zomato likely lost market share in the food delivery segment in the quarter amid rising competition. It attributed this potential decline to Zomato’s rivals scaling up 10-15 minute food delivery business faster. 

Meanwhile, as a result of the rising competition in the quick commerce space, Blinkit’s adjusted EBITDA loss surged about 13X YoY to INR 103 Cr. The vertical spent heavily on expanding its dark store network in the quarter, which also helped it double its revenue on a YoY basis in Q3 FY25. 

Meanwhile, Zomato’s bid to make a mark in the 10-minute food delivery space has irked the National Restaurant Association of India (NRAI), which has warned of a legal action against the company and its rival Swiggy. 

In response, Zomato CEO Deepinder Goyal reached out to restaurant partners to assuage their concerns. He said that Zomato will never compete with its own restaurant partners, adding that Bistro is neither a “private label” nor a “Zomato Kitchen”. 

Go Digit Shines Post Upbeat Financial Results

Buoyed by its impressive financial performance, insurtech major Go Digit General Insurance emerged as the top gainer this week. Its shares ended up 7.90% to end the week’s trade at INR 314.10. 

It is pertinent to mention that the company’s shares touched an all-time low at INR 276.80 on January 13.

Go Digit’s profit surged 176.46% to INR 118.52 Cr in Q3 FY25 from INR 42.87 Cr in the previous fiscal year, driven by strong revenue growth and controlled expenses.

The company’s net written premium grew 5.13% YoY to INR 2,084.14 Cr. In the first nine months of FY25, Go Digit sold 0.9 Cr policies, served 6.2 Cr customers, and captured a 3.3% market share in the insurance sector. 

Despite the upbeat financials, brokerage firm Emkay reiterated its ‘Sell’ rating on Go Digit and revised the price target to INR 250.

“Given the company’s opportunistic approach toward growth mostly in B2B segments, the predictability and sustained profitability improvement with growth looks challenging,” it said. 

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