Zomato shares plunge to new low on BSE

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Zomato shares plunge to new low on BSE

On Monday, the shares of Zomato Limited were under tremendous selling pressure and fell 19 per cent to a new all-time low of Rs 92.25 on the BSE. The stock has fallen over 45 per cent from its 52 week high. The firm's market cap fell to 73,833. 64 crore were owned by the BSE.

Zomato made a bumper debut on the bourses with the unicorn hitting the 1 lakh crore market cap. The stock opened at Rs 116, 52.63 per cent higher on the NSE against the issue price of Rs 76. The listing price was up 51.32 per cent, up from Rs 115 on the Bombay Stock Exchange.

The stock hit a 52 week high of Rs 169.10 on November 16, 2021. The shares of India's first food unicorn have fallen for the last 5 trading sessions and are trading lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

According to Abhay Agarwal, Founder, Piper Serica, the sharp correction seen in the recently listed Internet and tech stocks like Zomato has been driven primarily by more than 10% correction in Nasdaq over the last month. With an increase in interest rates, tech investors seem to be taking money off the table for the time being.

We don't see a rebound in tech stocks with all technical indicators flashing red. It is a good opportunity for long-term investors to add stocks like Zomato to their portfolio because it is a leader in a fast-growing industry that has only one other player. He said that since the company is well funded and has profitable unit-level metrics, we are not worried about the correction in valuation.

The food delivery firm reported better than expected topline figures for the quarter ended September 30. The company posted 21.29 per cent quarter-on-quarter QoQ and 140.42 per cent year-on-year YoY growth in consolidated revenue at Rs 1,024. In Q 2 of FY 22 there were 20 crore.

The growth of its food delivery business was a factor in the growth of Zomato's net loss, which widened to Rs 429.6 crore during the quarter under review. Net loss stood at Rs 229.6 crore in the year-ago quarter and Rs 356.2 crore in the preceding quarter ended June 30. Brokers on Dalal Street were bullish on Zomato after its Q 2 result.

Finance Minister Nirmala Sitharaman announced the change to the tax regime for hyperlocal food ordering services at the 45th meeting of the GST Council in September 2021.

She proposed that platforms such as Swiggy and Zomato should pay GST on behalf of their partner restaurants, including cloud kitchens and central kitchens, whose services are available through their apps. The proposal was accepted and came into effect on the first day of 2022, i.e.