Zomato Stock Price: Shares of food delivery aggregator and quick commerce company Zomato fell by about 5 percent during the day on January 7 and the price reached a low of Rs 251.40. At the close of trading, the stock settled at Rs 252.50, down 4.6 per cent. In fact, brokerage firm Jefferies has reduced its rating for Zomato stock from “Buy” to “Hold”. Besides, the target price has also been reduced from Rs 335 to Rs 275 per share. This new price is about 9 percent more than the closing price of the stock on January 7 on BSE. Due to this new update from Jefferies, there is selling pressure on Zomato shares.
The brokerage has written in its note that the increasing competition in the quick commerce space is a matter of concern for the profitability of the company. Apart from Zomato’s BlinkIt, Swiggy’s Instamart, Zepto, Amazon and other companies are also in the race to make their place in quick commerce.
Zomato stock may see consolidation in 2025
According to Jefferies, after more than doubling the value of Zomato stock in 2024, its shares may see consolidation in 2025. Given the strong execution and opportunity, the stock’s valuations are not extremely expensive. However, increasing competition in the quick commerce space is raising concerns. According to Jefferies’ note, aggressive moves by existing companies and entry of new companies in this space are most likely to lead to higher discounting. This could pose a threat to medium-term profitability.
Jefferies has cut FY2026 EBITDA estimates for Zomato by 12% and FY2025 estimates by 15%. Profitability estimates have been cut by 17% for FY2026 and 18% for FY2027. Jefferies has also cut Zomato’s earnings per share (EPS) estimates by 20% for FY2026 and 21% for FY2027.
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Shares rose 90 percent in one year
According to BSE, Zomato’s shares have risen by almost 90 percent in a year. It has come down 9 percent in a week. The market cap of the company is Rs 2.43 lakh crore. The stock had created a 52-week high of Rs 304.50 on December 5, 2024.
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