Zomato’s stock has been in the spotlight recently, especially following its latest announcements and market movements. As of October 18, 2024, Zomato’s share price stood at Rs 257.45, reflecting a drop of 5.4% after the company revealed plans for a fund-raising initiative through equity shares. This move has raised eyebrows among investors and analysts alike.
Main Points
Recent Developments
On October 22, 2024, Zomato’s board will meet to discuss raising funds via a Qualified Institutional Placement (QIP). This meeting will also cover the company’s earnings for the September quarter. In the previous quarter, Zomato reported a net profit of Rs 253 crore, largely attributed to revenue growth from its subsidiaries Blinkit and Hyperpure.
Here’s a snapshot of Zomato’s recent share price performance:
| Date | Share Price (Rs) | Change (%) |
|---|---|---|
| Oct 17, 2024 | 274.25 | -1.90% |
| Oct 18, 2024 | 257.45 | -5.4% |
| 52-Week High | 298.25 | |
| 52-Week Low | 101.25 |
The stock has seen fluctuations, with a notable decline following the announcement of its equity issuance plan.
Target Price and Analyst Ratings
Global brokerage CLSA has maintained an Outperform rating for Zomato with a target price set at Rs 283.90 per share. Analysts believe that Zomato is well-positioned as a leader in the food delivery sector, particularly as Quick Service Restaurants (QSRs) are losing market share to aggregators like Zomato.
- Support Level: Rs 250
- Resistance Level: Rs 280
These levels are crucial for traders looking to gauge potential entry and exit points in the stock.
- Strong Revenue Growth: The company has shown impressive revenue growth, particularly from Blinkit and Hyperpure.
- Positive Analyst Sentiment: Analysts are generally optimistic about Zomato’s future performance, as reflected in their target prices and ratings.
- Market Positioning: Zomato continues to dominate the food delivery market, gaining traction over competitors.
- Recent Price Drop: The stock has experienced significant declines recently, which may deter potential investors.
- Equity Issuance Concerns: The announcement of raising funds through equity could dilute existing shares, impacting current shareholders.
- Profit Booking: Investors may be cashing out after recent highs, leading to downward pressure on the stock price.
Important News
In addition to its financial updates, Zomato recently announced the resignation of independent director Ms. Gunjan Tilak Raj Soni effective October 11, 2024. This change in leadership could have implications for corporate governance and investor confidence.
The overall market sentiment has been mixed, with Indian indices closing lower amid profit booking after record highs earlier in the week. The Nifty index closed at 24,982, indicating some volatility in investor sentiment across sectors
