Zomato’s stock surged by as much as 4.3% during intraday trading on the BSE on Tuesday, October 3rd, reaching a fresh 52-week high of INR 105.9.
The increase occurred in the initial trading session following Zomato’s announcement of the liquidation of its wholly-owned subsidiary, Zomato Chile SpA (“ZM Chile”), after market hours on September 30th.
Zomato, which has recently shuttered several of its international subsidiaries, stated that the closure of ZM Chile will not affect its turnover or revenue.
Zomato’s stock has been on a bullish streak since April of this year, driven by its aggressive efforts to attain profitability, which it successfully achieved in the first quarter of fiscal year 2024. As of now, the stock has surged by 77.4% year-to-date (YTD).
Read More: Zomato turns profitable in Q1 FY24, reports INR 2 Cr consolidated PAT
Zomato’s shares have experienced a remarkable growth of more than 100% in the past half-year.
After a steep decline of nearly 65% from its 2022 listing price, the stock is currently trading only 8% below its initial listing price of INR 115.
After reaching a level last observed at the end of January 2022, the shares closed yesterday’s trading session with a 3.7% increase, ending at INR 105.3 on the BSE.
Zomato has been testing various new features on its platform as part of its efforts to boost its revenue. According to Kotak Institutional Equities, the foodtech company’s introduction of a platform fee, ranging from INR 2 to INR 3 per food delivery order in some cases, is expected to raise its customer take rate and contribution margin.
Meanwhile, Bernstein, in its recent analysis, noted that Zomato is “raising the profitability bar” and envisions long-term, high-teen growth in food delivery as contribution margins continue to improve.
Read More: Bernstein bullish on Zomato, predicts 21.7% gain with new INR 120 price target
In yesterday’s trading session, several other modern tech stocks also posted gains amid the broader consolidation within the domestic equity market. CarTrade Technologies and MapmyIndia both saw significant increases, surging by more than 6% each, while Paytm recorded a roughly 2% uptick, and EaseMyTrip advanced by 3.7%.
During yesterday’s trading session, the Nifty 50 index fell by 0.56% to 19,528.75, and the Sensex declined by 0.48% to 65,512.1.