Zomato Share Price Touches New Highs, Gains 53% in Past 2 Months
Zomato, the Indian online food delivery and restaurant discovery platform, reached a new one-year high on Friday, June 9th, with its shares trading above the IPO price of INR 76. The stock hit INR 78 during the day, its highest level since April 26th, 2022. Zomato’s shares closed at INR 77.90 on the Bombay Stock Exchange (BSE) with a gain of 2.77%.
Key Highlights:
– Zomato’s shares have risen by almost 53% in the past two months.
– Despite the recent surge, the stock is still trading 52% below its all-time high of INR 160.30, which it achieved on November 15th, 2021.
– Investors are bullish on Zomato due to positive news around the company’s earnings and inclusion in the long portfolios of investors like Chris Wood of Jefferies, who holds a 4% weightage in Zomato.
– Jefferies also cited the expansion of margins in the food sector and the reduction in losses from Blinkit as potential drivers of Zomato’s profits.
– The company’s management has also been focused on increasing its user base and recently launched a Gold program to achieve this goal.
– Other factors contributing to the positive sentiment around Zomato include an increase in its weightage on the MSCI index and changes in discounts and incentives by ONDC.
Zomato’s consolidated revenue for the March quarter was INR 2,056 crores, up 70% YoY. The company also reported a net loss of INR 188 crores for the quarter, down from INR 360 crores in the same quarter last year.
Zomato’s stock price has been on a steady rise since March, with analysts attributing this trend to the company’s successful efforts to reduce losses. Despite challenges posed by the current economic climate, the management’s focus on growth and profitability has been a positive factor for investors.
In conclusion, Zomato’s recent surge in stock price reflects investor confidence in the company’s growth prospects. The expansion of margins and reduction in losses, along with the launch of new programs to increase its user base, have all contributed to the positive sentiment around the stock.
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