Zomato, led by billionaire Deepinder Goyal, witnessed a surge of 6.42%, pushing its share price beyond the ₹300 threshold. This impressive rally has provided investors with a year-to-date (YTD) return of 140%. On December 5, Zomato shares reached an all-time high of ₹299.25 on the BSE, rallying 4.5%. By the end of the day, the stock was trading at ₹296.25, up by 3.48%.
Last week, the food delivery giant announced it had raised ₹8,500 crore through a Qualified Institutional Placement (QIP) to drive its growth ambitions. CEO Deepinder Goyal highlighted that the capital infusion aims to strengthen the company’s balance sheet.
The QIP issue, which opened on November 25, saw Zomato allot 33.65 crore shares to qualified institutional buyers at ₹252.62 per share, raising ₹8,500 crore. This allotment was made at a 5% discount to the floor price of ₹265.91 per share, as stated in a regulatory filing.
Zomato’s financial performance has also shown significant improvement. In Q2 FY24, the company reported a consolidated net profit of ₹176 crore, compared to ₹36 crore in the same quarter last year. Its revenue from operations rose to ₹4,799 crore, up from ₹2,848 crore in the previous fiscal year. Total expenses for the quarter stood at ₹4,783 crore, compared to ₹3,039 crore in the year-ago period.
Zomato is set to achieve another major milestone with its inclusion in the sensex index, effective December 23. This marks the company’s entry into the elite 30-stock index, reflecting its strong performance and market presence. Over the last 12 months, Zomato shares have rallied 154%, including a 138% rise in 2024.
Global brokerage firm Morgan Stanley recently maintained an “overweight” rating on Zomato, setting a target price of ₹355. It described Zomato as a “potential doubler” within the next 3-4 years. The report cited the growing prominence of quick commerce in India’s retail sector, strong food delivery operations, a solid balance sheet, and a substantial profit pool projected by 2030 as key drivers for its optimistic outlook.
