On Tuesday, February 15, the share prices of a food delivery company, Zomato has fallen below its issue price of Rs 76. The share prices have hit their lowest to Rs 75.75 since its issuance. However, the share prices increased to Rs 82.7 per share again i.e., around a 0.30 per cent increase.
For the last three months, the share prices of Zomato has been slipping. On November 16, 2021, the shares recorded their highest level of Rs 169.10. After November, the share prices have been reduced by over 50 per cent.
According to the analysts, the upcoming Indian Premier League might help in bouncing back of the share prices of the company. It is also said that increasing cost pressures along with a poor contribution of government has led to the reduction of share prices. In addition, restrained cashflows has resulted in the reduction in DCF (discounted cash flow) value.
Zomato had entered the stock market on July 23, 2021. In the third quarter of the financial year 2022, Zomato’s revenue had increased by 9 per cent. However, delivery charges also increased by 22 per cent. The Ebitda loss was also reduced to Rs 270 crores in comparison to its loss in the second quarter which was Rs 310 crores. Further, post-Covid removal of lockdown, reduction in delivery charges and expansion of company across several cities led to the growth of the net order value of Zomato. Meanwhile, Zomato is facing a trajectory performance.
