Zomato Slumps Over 8% To Close At Lowest Level Since July 2022

Shares of foodtech giant Zomato hit their lowest level in almost six months during intraday trading on Wednesday, falling as much as about 15% to INR 44.35 on the BSE.

However, it recouped some of the loss to end the day 8.3% lower at INR 47.8 on the BSE, its lowest closing since August 1, 2022.

It is pertinent to note that Zomato relaunched its much-awaited loyalty programme Zomato Gold earlier this week, months after it discontinued its earlier loyalty programme Zomato Pro Plus.

Besides, the stock exchanges have also sought a response from the startup on reports that it is shutting down its 10-minute food delivery program ‘Zomato Instant’. However, denying the report, Zomato earlier told Inc42 in a statement that it is working on a new menu and rebranding Zomato Instant, and there are no plans to shut it down.

Besides Zomato, other new-age tech stocks also fell on Wednesday in line with a slump in the overall stock market amid expiry of futures and options (F&O) contracts. From Paytm to Nykaa, and EaseMyTrip to Tracxn, most new-age stocks fell in a range of 1%-5%.

Benchmark indices Nifty50 and Sensex also declined 1.25% and 1.27% to 17,891.95 and 60,205.06, respectively. Indian stock markets will be closed on Thursday on account of Republic Day.

Commenting on Wednesday’s performance, Shrikant Chouhan, head of equity research (retail) at Kotak Securities, said that traders liquidated their positions ahead of the follow-on public offer (FPO) of Adani Enterprises and transition to T1 settlement cycle from T2 on Friday.

Ahead of the opening of the FPO, research firm and short-seller Hindenburg Research in a report alleged that the Adani Group is “engaged in a brazen stock manipulation and accounting fraud”. Meanwhile, the Indian conglomerate rubbished the allegations by calling it a “malicious combination of selective misinformation”.

Despite the overall slump in new-age tech stocks, CarTrade Technologies ended today’s session 1.5% higher at INR 480.5 after the startup reported a consolidated profit after tax of INR 14.04 Cr in the December quarter of FY23 as against a loss of INR 18.48 Cr in the same quarter last year.

On the other hand, shares of Nazara Technologies fell only 0.8% to end the session at INR 606.1 following the gaming company reporting a 31% increase in its consolidated net profit to INR 22.4 Cr during December 2022 quarter on Tuesday.

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