Zomato Share Price Update
Zomato shares have delivered stellar returns in 2024, climbing over 131% year-to-date (YTD). On Wednesday, the stock rose by another 3%, hitting an intraday high of ₹289.70, nearing its September peak of ₹298.20.
This impressive growth is fueled by strong investor interest and strategic business updates, positioning Zomato as a top-performing stock.
Major Developments Behind Zomato’s Surge
1. ₹8,500 Crore Raised via QIP
Zomato recently secured ₹8,500 crore through a Qualified Institutional Placement (QIP) at a floor price of ₹265.91 per share. This funding will drive strategic expansion, with a significant portion allocated to Blinkit, Zomato’s quick commerce subsidiary.
2. Blinkit Expansion Plans
Zomato plans to invest ₹2,100 crore in Blinkit’s capex from FY2026 to FY2028. The investment will focus on building dark stores and enhancing warehousing capabilities.
- Blinkit Stats:
- Operates 2.5 million sq. ft. of dark store area.
- Generates ₹89,500 per sq. ft. in net gross merchandise value (GMV).
3. Food Delivery Growth
Zomato reported a 24% YoY increase in power customers (50+ orders per year), reaching 34 lakh in FY2024. The unique transacting customer base also grew by 8.6% YoY to 6.3 crore, with an average of 12 orders annually per customer.
Untapped Potential in India’s Food Delivery Market
Brokerage firm Kotak Institutional Equities highlighted the untapped growth in India’s food delivery sector. Currently, only 10% of internet users in India order food online, compared to 50-55% in markets like the US and China.
Zomato’s focus on food delivery is evident, as it plans to shift its restaurant and event bookings entirely to its District app, streamlining operations and enhancing growth.
Expert Opinion: Should You Invest in Zomato Stock?
Kotak Institutional Equities retained its ‘Buy’ rating on Zomato, setting a price target of ₹315. This suggests a potential upside of around 9% from current levels.
With Zomato’s:
- Inclusion in the Sensex,
- Strategic initiatives like Blinkit expansion, and
- Continued growth in the food delivery business,
analysts believe the stock is well-positioned for further growth.
Conclusion
Zomato’s remarkable performance, robust growth strategy, and focus on India’s expanding food delivery market make it a strong contender for investors seeking long-term gains. However, investors should assess market conditions and risk factors before making a decision.
