Foodtech giant Zomato’s stock price reached a 52-week high of INR 115 on the morning of October 18, driven by its strategic partnership with the Indian Railway Catering & Tourism Corp (IRCTC).
Zomato’s shares wrapped up Tuesday’s trading session at INR 113.90 and kicked off Wednesday’s trading at INR 114.25. However, by 12:20 pm, the shares had dipped to INR 111.45.
In a noteworthy development, Zomato has forged an agreement with the Indian Railway Catering and Tourism Corporation (IRCTC) to offer pre-ordered meal provisioning and delivery as part of an experimental initiative.
Read More: Zomato partners with IRCTC to launch meal reservation for railway travelers
In the initial stage, the project will commence with a pilot program aimed at showcasing its viability. It will provide railway passengers with the opportunity to reserve meals via the IRCTC e-catering platform. At the outset, this service will be accessible at five prominent train stations: New Delhi, Prayagraj, Kanpur, Lucknow, and Varanasi.
“… IRCTC has tied up with M/s. Zomato Limited for supply and delivery of preordered meals through IRCTC’s E-catering portal as a Proof of Concept (PoC) in the first phase at five Railway stations i.e. New Delhi, Prayagraj, Kanpur, Lucknow and Varanasi,” said IRCTC in a regulatory filing with the BSE.
In Tuesday’s intraday trading on the Bombay Stock Exchange (BSE), following the announcement from IRCTC, Zomato achieved a fresh 52-week peak of INR 114.10.
In the first quarter of the fiscal year 2024 (Q1 FY24), Zomato achieved its first-ever profitable quarter, recording a profit after tax (PAT) of INR 2 Crore. This marks a significant turnaround from the net loss of INR 186 Crore reported in Q1 FY23. Concurrently, the company’s revenues from operations surged to INR 2,416 Crore in the quarter ending June 2023, a notable increase compared to INR 1,413.9 Crore in Q1 FY23.
Read More: Zomato turns profitable in Q1 FY24, reports INR 2 Cr consolidated PAT
During the second quarter (Q2), Zomato faces the challenge of maintaining profitability, with macroeconomic factors continuing to influence the demand for online food delivery, according to a recent report by JM Financial.
“We expect Zomato’s sequential food delivery GOV (gross order value) growth in Sep- Q to be closer to mid-single digit (mid-teens growth on a YoY basis, broadly in-line 1Q). Blinkit, on the other hand, could report very strong high-teens sequential GOV growth led by a robust increase in order volume,” the brokerage said.