Zomato touched a new 52-week high at INR 109.75 as its shares jumped as much as 3.2% during the intraday trading on the BSE
Paytm shares jumped 3% in the intraday trading today to hit a fresh 52-week high, for the second consecutive session, at INR 978 on the BSE
The gains in the broader equity market also propelled up other new-age tech stocks, including Nykaa, Yatra, DroneAcharya, CarTrade Technologies, IndiaMART, and Delhivery
Inc42 Daily Brief
Stay Ahead With Daily News & Analysis on India’s Tech & Startup Economy
Shares of foodtech major Zomato touched a new 52-week high at INR 109.75 as they jumped as much as 3.2% during the intraday trading on the BSE on Wednesday (October 11).
Meanwhile, Paytm touched its 52-week high for the second consecutive session today.
The uptrend in the stocks came on the back of a rally in the broader equity market today.
ICICI Securities has increased its price target (PT) on Zomato to INR 160 from INR 120 earlier, implying an upside of almost 47% to the stock’s last close today, given the company’s improved visibility of profitability and sustained improvement in the underlying operating metrics.
Zomato reported a profitable quarter for the first time in Q1 FY24. With the Q2 FY24 earnings season now set to start following IT major TCS reporting its financial statement today, the new-age tech stocks will be watched out in the coming days.
“The commencement of the 2nd quarter earnings season by TCS on October 11 not only serves as the symbolic starting signal but also paves the way for potential share buybacks alongside the Q2 results,” said Prashanth Tapse, senior VP (research) at Mehta Equities.
“One stock that stands out as a compelling buy right now is Zomato,” he said, adding that it is now recommended to establish a long position on the stock at the current market price, targeting INR 121 or INR 143.
Tapse also suggested setting aggressive one-year targets at the psychological mark of INR 175, with a stop loss at INR 81.
Shares of Zomato ended today’s session at INR 109.1, just 5% below the company’s listing price of INR 115. Last year, the shares had declined over 60% compared to the listing price.
While Q2 would be a crucial quarter for Zomato in showing its ability to sustain profitability, JM Financial said in a recent report that the brokerage’s channel checks suggest macro pressures continued to weigh on demand for online food delivery in the quarter.
“We expect Zomato’s sequential food delivery GOV (gross order value) growth in Sep- Q to be closer to mid-single digit (mid-teens growth on a YoY basis, broadly in-line 1Q). Blinkit, on the other hand, could report very strong high-teens sequential GOV growth led by robust increase in order volume,” the brokerage said.
The company had reported a food delivery GOV of INR 7,318 Cr while Blinkit reported a GOV of INR 2,140 Cr in Q1 FY24.
Meanwhile, shares of Paytm jumped 3% in the intraday trading today to hit a fresh 52-week high at INR 978 on the BSE.
Several brokerages said in their recent research reports that financial services companies, including Paytm, are set to post healthy growth numbers in Q2 FY24, largely helped by steady sequential loan growth.
Paytm ended today’s trading session at INR 971.9, up 2.4% on the BSE.
Today’s rally was not just limited to Zomato and Paytm as other new-age tech stocks like Nykaa, Yatra, DroneAcharya, CarTrade Technologies, IndiaMART, Delhivery, and Fino Payments Bank also ended the session in the green.
Benchmark indices Sensex and Nifty50 closed 0.60% higher at 66,473.05 and 0.62% up at 19,811.35, respectively.
Note: We at Inc42 take our ethics very seriously. More information about it can be found here.