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Zomato’s market cap goes below Rs 1 trillion

Zomato shares fell 5% on the BSE to a more than the five-month low of Rs 119.35. The stock of the food delivery company fell for the fourth day in a row, losing 11% over time. In intraday trade on the BSE on Friday, Zomato shares plummeted 5% to a more than the five-month low of Rs 119.35. The food delivery company’s stock sank for the fourth day in a row, losing 11% in that period.

Zomato slides 5% and approaches a record low and Zomato’s market cap goes below Rs 1 trillion

Zomato's market cap goes below Rs 1 trillion

Courtesy: Zomato

According to BSE data, Zomato’s market capitalization fell below Rs 1 trillion at 09:58 a.m., to Rs 95,007 crore. Zomato has underperformed the market, sliding 8% versus a 5% rise in the S&P BSE Sensex.

Zomato’s stock price has decreased 29 percent in four days since its 52-week high of Rs 169.10 on November 16, 2021. The stock is now trading close to its all-time low of Rs 114. Zomato raised Rs 9,375 crore in an initial public offering (IPO), issuing shares at Rs 76 per share.

Zomato has underperformed the market, sliding 8% versus a 5% rise in the S&P BSE Sensex. The stock has dropped 13% in the last three months, compared to a 3% drop in the benchmark index.

Zomato’s market value (market cap) fell below Rs 1 trillion at 09:58 a.m., to Rs 95,007 crore. Zomato has also dropped out of the top 50 most valuable publicly traded companies in terms of market capitalization.

The Metro restaurant network on Zomato is less dense and smaller than Swiggy’s. Restaurant exclusivity is more than predicted, according to the worldwide brokerage industry, with Swiggy dominating at 56 percent and Zomato at 45 percent, meaning higher take-rates.

Zomato provides greater discounts, implying greater aggression, and diminishing contribution margins (CM). According to JP Morgan, Swiggy casts a bigger net with a larger service radius, expanding consumer options and supporting them in establishing/maintaining leadership.

Zomato is not the only one who has been affected. Policy Bazaar has equally been hit. The market value had dropped to $3.3 billion from $6 billion when it went public for the first time. Things appear to be just as bad in the country’s private market. Many large investors, including Tiger Global and the Canada Pension Plan, have reduced their stakes.

According to multiple sources familiar with the situation, Tiger Global is now only focused on early-stage acquisitions in India and has grown more conservative in how pricing rounds.

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Also read: Cryptocurrency assets lost $800 billion in market value

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