Shares of Zomato surged as much as 4.6% to INR 268 during the intraday trading on Wednesday
Axis Securities maintained its buy rating on Zomato with a price target of INR 350, while Nuvama also maintained the buy rating with a price target of INR 325
Shares of Zomato have been on an upswing for the last year or so on the back of the company’s improving bottom line
Shares of foodtech major Zomato
surged as much as 4.6% to INR 268 during the intraday trading on the BSE on Wednesday (October 23), a day after the company reported its financials for the quarter ending September.
However, the stock pared some of the gains to end the day 2.9% higher at INR 263.85 on the BSE.
As many as 16.16 Cr shares of Zomato were traded during today’s session. The company’s market capitalisation stood at INR 2.3 Lakh Cr (around $27.7 Bn) at the end of the day.
In the broader market, benchmark Sensex crashed 138.7 points, or 0.17%, to 80,081.98 and Nifty50 fell 36.60 points, or 0.15%, to end the day at 24,435.50
Shares of Zomato have been on an upswing for the last year or so on the back of the company’s improving bottom line. The stock has given 111.93% return on a year-to-date basis.
In Q2 FY25, the company reported a 389% year-on-year increase in its consolidated net profit to INR 176 Cr. However, net profit dropped 30% from INR 253 Cr in Q1 FY25, as Zomato saw an increase in expenses due to Blinkit’s expansion spree.
Despite this, brokerages continue to be bullish on the stock. Axis Securities maintained its buy rating on Zomato with a price target of INR 350.
“Strong demand from the top 10 cities for food order delivery is expected to continue. Blinkit is anticipated to achieve 20%+ growth over the next 5 years, supported by growing demand, a better brand, and superior execution,” the brokerage said.
Nuvama also maintained its buy rating with a price target of INR 325 for the stock.
“Zomato continues to push the paddle of growth across its business.We expect Blinkit dark store addition to be faster than initially expected—hence growth shall be even faster while profitability would be delayed due to higher upfront cost thereof, which, in our view, is the right strategy in a cut-throat QC market,” Nuvama said.
Meanwhile, Zomato has also increased its platform fee to INR 10 amid the ongoing festive season.
The company collected INR 75 Cr from the platform fee in the quarter ending September 2024.
