How investor Rakesh Jhunjhunwala predicted Zomato share crash last year
Premium- Rakesh Jhunjhunwala had predicted about the fall in Zomato and some other shares as they were trading at higher valuations
Zomato shares have been nosediving after climbing to its life-time high of ₹169 apiece levels in mid-November 2021. The huge sell-off was triggered in the last two sessions after the end of one-year lock-in for promoters, founders, employees and other, who constitute around 78 per cent of the net paid up capital of the food chain platform stock.
Veteran investor Rakesh Jhunjhunwala had predicted such fall in 2021 and had cautioned against itself around a year ago when the stock was climbing new highs on a regular basis.
In a viral video, that has been doing rounds on various social media platforms, Rakesh Jhunjhunwala is found warning Zomato shareholders at India Today conclave citing, "Time will come when excess in the market will correct because excesses in the markets are pro to correction." In this viral video the 'Warren Buffett of India' has been found telling, 'If I say today that don't buy Zomato share, people will call me a fool.'
Like Rakesh Jhunjhunwala, another ace investor Shankar Sharma has also said that the stock had its game over on its listing at such a higher valuations citing, "Zomato stock reminds me of what Amitabh Bachchan said in Deewar on hearing news of dad's death:" Mar to woh bees saal pehle gaya tha. Aaj to sirf ussey jalaya ja raha hai". It was game over on listing itself."
Former BharatPe founder and Shark Tank India judge Ashneer Grover too had his say on the recent tank in Zomato shares. He said that Zomato shares could have been ₹450 if it had merged with Swiggy instead of BlankIt citing, "@letsblinkit served piping hot misery to @zomato in 10 minutes ! Yeh hi agar @Swiggy ko merge kar liya hota to ₹450 ka stock hota !!"
On how Zomato share ESOP has cost dearly for the employees of the food chain platform, Ashneer Grover tweeted few months ago, "It’s all about perspective. If you were a Zomato employee and exercised your ESOP at ₹140 or higher price post IPO, you probably paid more cost per share as Income Tax, than what you can buy it today from market freely. At ₹56 / share price, markets are giving everyone ESOPs."
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Zomato share price history
Zomato shares were launched in the primary markets at a price band of ₹72 to ₹76 and the stock listed on 23rd July 2021 at a bumper premium of over 51 per cent. The stock continue to climb new high till mid November 2021 when it hit its current 52-week high of ₹169 apiece levels on NSE.
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