Zomato, the online food delivery platform, witnessed a significant surge in its share price as it reported impressive results for the quarter ended December 2023. The company’s stock jumped over 4% in early trade, reaching a fresh 52-week high. The robust growth in its food delivery business played a crucial role in driving these impressive results.
The Q3FY24 net profit for Zomato stood at ₹138 crore, a substantial increase compared to a loss of ₹347 crore during the same period last year. The net profit surged 283% on a quarter-on-quarter basis, reflecting the company’s commendable performance.
Zomato’s revenue from operations in Q3FY24 also witnessed a significant growth, totaling ₹3,288 crore, a 69% increase compared to ₹1,948 crore in the previous year.
Foreign brokerage firm Jefferies lauded Zomato’s Q3FY24 as another strong quarter, highlighting exceptional performance and smart margin gains in the food delivery sector. Jefferies revised its adjusted Ebitda estimates and raised the target price for Zomato’s stock from ₹190 to ₹205 per share, emphasizing a potential 25% CAGR in delivery revenue over the next few years.
In a similar vein, Emkay Global Financial Services described Zomato’s performance in Q3 as impressive execution across segments. While the growth in food delivery gross order value (GOV) fell short of expectations due to a muted demand environment, Blinkit continued to excel with significant growth in GOV and a reduction in losses. Emkay Global increased its FY25-26E EPS estimates, retaining a ‘Buy’ rating on Zomato, and raising the target price to ₹170 per share.
Zomato’s shares have witnessed a remarkable surge, rising over 121% in the past year alone. As of now, the shares were trading at ₹149.40 apiece on the BSE.
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