Shares of Zomato rose 7% in early trade today following its inclusion in the prestigious 30-stock Sensex index; Know the latest target price
Following its inclusion in the prestigious 30-stock Sensex index and its Rs. Shares of Zomato jumped 7 percent in early trade today following approval for an Rs 8,500 crore qualified institutional placement (QIP). Share Rs. 273, which was earlier Rs. 264.15 to close at Rs. It touched an intra-day high of 282.85, a gain of 7%.
A total of 14.70 lakh shares changed hands, resulting in Rs. 41.79 crore turnover. On Monday, the market capitalization of the company rose to Rs. 2.47 lakh crores.
The outlook for the stock remains positive in both short and long term, as it is trading above the key moving averages-5-day, 10-day, 20-day, 50-day, 100-day and 200-day.
Currently reached on September 24, 2024 Rs. Trading near a 52-week high of 298.20, Zomato shares have gained 338 percent in the past two years and 147.30 percent in the past year. The stock has shown low volatility with a beta of 0.7 over the past 12 months.
Zomato joins Sensex
On Friday, BSE’s Asia Index Pvt Ltd, a wholly-owned subsidiary, announced the restructuring of several indices including BSE 100, BSE Sensex 50, and BSE Sensex Next 50. Zomato’s addition to the 30-stock Sensex follows a significant 130 percent gain. Price gains in the past year have exceeded the Sensex’s 12-month return by 20 percent. For comparison, JSW Steel shares have gained 27 percent over the same period.
BSE has also announced changes in other indices like BSE SENSEX 50, BSE SENSEX NEXT 50, and BSE 100. Ashok Leyland, PI Industries, IDFC First Bank, IRCTC, UPL, and APL Apollo Tubes will fall from the BSE 100, Jio is joined by financial services, Suzlon Energy, Adani Green Energy, Adani Power, Samvardhan Motherson, and PB Fintech. These changes will come into effect from December 23. Additionally, HDFC Life, BPCL, and LTI Mindtree will be removed from the BSE SENSEX 50, and replaced by Zomato, Jio Financial, and HAL.
Zomato’s Rs. 8,500 crore QIP has got shareholders’ approval
Zomato shareholders through a Qualified Institutional Placement (QIP) raised Rs. 8,500 crore has been approved. The funding, approved by Zomato’s board earlier in October, is aimed at strengthening the company’s balance sheet. During the September quarter, Zomato recorded a cash reserve of Rs. 1,726 crore, which was mainly due to Paytm’s entertainment ticketing business at Rs. 2,014 crore is due to the acquisition of Rs.
An analyst’s view
Several brokerages have raised their target prices for Zomato, citing strong growth potential in both the food delivery and e-commerce sectors, which has fueled the stock’s rise.
In its latest report, Nomura maintained a “buy” rating and set a target price of Rs. 280 to Rs. 320 done. The company sees significant scope for growth in Zomato’s quick-commerce business, which is expanding its store density. The objective of the company is to increase It has quadrupled its store count, targeting 2,000 stores by December 2026.
Morgan Stanley has reaffirmed its ‘overweight’ rating on Zomato and set a target price of Rs. 288 per share to Rs. 355 done. The global brokerage expects the company to maintain its market share of around 40 percent despite increasing competition. It expects Zomato to achieve EBITDA breakeven in the next two to four quarters, reflecting significant investments in expansion.
Morgan Stanley forecasts margins of 2.2 percent by FY2027 and 5.1 percent by FY2031, with potential for an annual profit pool of around $1 billion by 2030. The brokerage values Zomato’s Blinkit business at Rs per share compared to the implied market value. There are 212. 120 per share. Firm Rs. Sees downside support at 160 (35 percent below current market price) and sees potential upside of 37 percent to its price target.
Disclaimer:Disclaimer: The opinions and investment tips of the experts in this News18.com report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decision.