The Zomato stock has lost more than Rs 1 trillion in market capitalisation since it hit a peak of Rs 169.10 on November 16, 2021, with the shares plunging to Rs 41.65 apiece on Tuesday. In just two sessions, the food delivery player, which listed on the bourse on July 23, 2021, has given up close to Rs 9,450 crore in value. With the lock-in period for anchor investors lifted, the Zomato stock had plunged 11.4% on Monday. The price of the shares in the initial public offering (IPO) was Rs 76 per share.
The weakness in the Zomato counter rubbed off onto other new-age tech company (NATC) stocks. A clutch of eight stocks has lost Rs 18,000 crore in value over the last two sessions with Paytm losing Rs 2,832 crore in value and Delhivery losing Rs 3,387 crore. Nykaa was the sole gainer.
Analysts at Jefferies wrote that Zomato’s Blinkit acquisition elongates path to profitability and despite the management guidance on a break-even in food delivery, investors are not giving it the benefit of the doubt. “Worries of Fed tightening & investor focus on cash flow have been weighing on the Internet names, including food tech, globally. From an exuberance at the time of listing last year, Zomato is now unloved, having underperformed peers y-t-d,” they observed. The brokerage has set a price target of Rs 100 for the stock.