Zomato Shares Jump Over 5% Amid Block Deal Buzz

On Wednesday, Zomato’s stock price soared by more than 5% in early trading after a block deal involving the foodtech giant. The shares reached a high of INR 99.50 each on the BSE.

According to Bloomberg data, a block deal on the stock exchanges saw approximately 10 crore Zomato shares, representing a 1.17% stake in the company, traded at an average floor price of INR 94.70 per share. The total value of this transaction amounted to around INR 947 Cr.

Following the conclusion of the lock-in period for Blinkit on August 25, Zomato Ltd. experienced a shift in its equity, involving 2.14% of its shares on Monday as well.

A total of 18.4 Cr shares were traded within a price range of INR 92.20 – INR 94.00 on Monday, as per Bloomberg’s data on major trades. The identities of the buyers and sellers are undisclosed at this time.

Last week, reports surfaced that SoftBank was contemplating the sale of additional Zomato shares via block trades.

SoftBank, which was also an investor in Blinkit, received Zomato shares when the latter acquired the quick-commerce startup in August last year in a deal worth INR 4,447 Cr. These shares were subject to a 12-month lock-in period.

Investment firm Tiger Global also exited Zomato by selling 12.24 Cr shares, equivalent to a 1.44% stake, on Monday through open market transactions. Tiger Global’s Internet Fund III Pte Ltd sold the shares in multiple tranches at an average price of INR 91.01 per share, totaling INR 1,123.84 Cr, according to BSE bulk deal data.

In Q1 FY24, Zomato posted a consolidated profit after tax (PAT) of INR 2 Cr as against a net loss of INR 186 Cr in the corresponding quarter of the previous fiscal year.

The gross order value (GOV) of Zomato’s food delivery business stood at INR 7,318 Cr in Q1 FY24 as against INR 6,425 Cr in the corresponding quarter of the last fiscal.

As part of its efforts to achieve profitability, the foodtech giant has broadened the reach of its platform fee, along with an increase in the fee. Initially, Zomato charged a fee of INR 2 per order for specific users. However, the company has now raised the platform fee to INR 3 for certain users residing in Tier II cities, as reported by Inc42. Meanwhile, the fee remains unchanged at INR 2 for the majority of users in metro cities.