The share price of Zomato has been consolidating since November 2021. Food Delivery Company Stock Life-time Low 50.05 on NSE on 12th May 2022. However, after reaching its lows, Zomato shares have been steadily moving north. The stock price of Zomato has seen a sharp jump following promising guidance from the company management after the announcement of Q4 results. In the last 5 sessions, Zomato’s share price has risen by from 57.05 At 72.05 levels on the NSE, it gained close to 26 per cent in the period.
According to Share Market Experts, Zomato has announced that it has approx. 12,200 crores of unrestricted cash and their capital requirement is limited. Furthermore, during the commentary, the company has promised to control its operating costs and improve its margins in the coming quarters. He said that this has turned in favor of the stock and now it has started moving northwards. However, he added that those who have this stock in their portfolio should continue to hold the stock while new investors should avoid taking any new positions in the counter.
to speak on zomato share price Rally, Ravi Singhal, Vice Chairman, GCL Securities said, “Post-Q4 results, the Zomato management has announced that it is approx. 12,200 crores of unrestricted cash and their capital requirements are limited. Hence, there will be no cash burn in the company. In addition, the company has said that it will control its operating costs and improve margins in the coming quarters. This has boosted the morale of Dalal Street and is probably the reason behind the rally in Zomato share prices in the recent sessions.”
According to analysts at Jefferies, “Zomato aims for rapid growth, despite the focus being on loss reduction, in line with long-term shareholder expectation. 1QFY23 losses should be meaningfully lower.”
However, Ravi Singhal of GCL Securities said Zomato shareholders should retain the stock. 77 more 84 targets in the short term. However, he advised new investors to avoid taking any fresh positions as the EBIDTA of the company has come down on QoQ basis while it has almost doubled on YoY basis.
In Q4FY22 results, Zomato registers 75 per cent growth in operating revenue 692 Cr to 1212 crores on a year-on-year (YoY) basis.
Denying any possible possibility of cash burn, Zomato management said, “We are well funded to fuel all our growth plans across all our businesses. Any further capital raising is required/planned at this stage.” Not there.”
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.