Zomato Shares Touch An All-Time High After ESOP Plan Gets Shareholders’ Nod

Shares of Zomato jumped more than 3% to reach an all-time high of INR 209.75 apiece during the intraday trading today (July 2) after the foodtech major received shareholders’ approval to create a new employee stock option pool of 18.26 Cr shares. 

The stock opened today at INR 203.45 per share, marking a 0.3% decline from the previous close.

After hitting a record high, the stock shed some gains and was trading 1.37% higher at INR 206.85 apiece on the BSE at 12:06 PM.

The price surge came on the heels of an announcement by Zomato that it has secured approval from its shareholders to formulate, adopt and implement a new employee stock option plan, Zomato ESOP 2024, to grant 18.26 Cr employee stock options, as per regulatory filings.

The food delivery giant in May said that Zomato ESOP 2024 will entitle the employee for one fully paid-up equity share of face value of INR 1 each against each ESOP exercised.

As per the stock’s opening price on Tuesday, the ESOP plan would translate to shares worth nearly INR 3714.9 Cr.

Zomato clocked a 26% sequential growth in consolidated net profit to INR 175 Cr for the quarter ended March 2024. Its consolidated net profit in Q3 FY24 stood at INR 138 Cr.

It is pertinent to note that global brokerage Morgan Stanley last month reiterated its overweight call on Zomato, setting a price target of INR 235 apiece, which implies an upside of 13% from the stock’s last close on Monday.

Overall, the stock has jumped 4.5% in the last five days.

Earlier this week, Zomato said it has been slapped with a goods and services tax (GST) demand notice of INR 9.45 Cr by the Assistant Commissioner of Commercial Taxes (Audit) in Karnataka.

Meanwhile, the company has launched a new platform in a bid to support restaurants in the recruitment process, as part of its broader portfolio expansion plans.