PremiumZomato with its large strong footprint across 23 countries, is well placed to benefit from the immense potential in the food delivery industry. The business is not losing cash anymore and adjusted EBITDA broke-even in food business, said domestic brokerage and research firm Motilal Oswal.
At company level, goal is to break-even in Q4FY23, or by 2QFY24. Blinkit integration post acquisition went well and it has not lost any market share in the last quarter, it added.
Based on the technical factors, Motilal Oswal said that “ Zomato stock is at major support zone of its weekly averages and sustaining well above them which is indicating strength. Momentum is building up in a rising channel which adds support to the stock for up move."
The brokerage house has ‘Buy’ rating on Zomato shares with a target price of ₹86 apiece, implying a potential upside of about 30%, with a stop loss of ₹56 and time horizon of about 1-3 months.
Meanwhile, Alipay Singapore, an arm of chinese e-commerce giant Alibaba, on Wednesday sold 3.07% stake in online food delivery aggregator Zomato for ₹1,631 crore through an open market transaction. According to the bulk deal data available with the National Stock Exchange (NSE), Alipay Singapore Holding Pte offloaded a total of 26,28,73,507 shares.
For the quarter ended September 2022, Zomato reported narrowing of its consolidated net loss to ₹250.8 crore for the second quarter ended September 2022, as compared to ₹434.9 crore loss in the year-ago period.
Adjusted core loss, excluding figures for its recently acquired quick-commerce business Blinkit, losses narrowed to ₹60 crore from ₹310 crore. The transaction with Blinkit closed on August 10, 2022 and hence the financials for Blinkit were consolidated from that date.
Meanwhile, its revenue from operations increased to ₹1,661 crore during the July-September quarter, as against ₹1,024 crore in the corresponding period of the previous financial year. Gross order value, or the total value of all food delivery orders placed online on Zomato's platform, jumped nearly 23%.
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