Zomato listing HIGHLIGHTS: Share price ends first day of trade at Rs 126; jumps 66% from IPO price

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Updated: July 23, 2021 6:12:16 pm

Zomato share market debut LIVE: Zomato shares made a strong stock market debut on Friday, listing at Rs 115 apiece on BSE.

zomato listing, zomato ipo, zomato share priceZomato ended the initial day of trade on the stock exchanges in the green. Image: Zomato Twiiter

Zomato IPO share listing HIGHLIGHTS: Zomato shares made a strong stock market debut on Friday, closing the initial day of trade at Rs 126 per share on the NSE. Zomato’s stock price was up 66 per cent or Rs 50 from IPO price of Rs 76. On opening, Zomato shares hit 20 per cent upper circuit at Rs 138, nearly doubling IPO investors money. The total market capitalisation of the online food ordering platform stood at Rs 98,211 crore on the closing bell, down from Rs 1 lakh crore earlier in the day. While on BSE, Zomato shares closed 65 per cent or Rs 49.86 higher at Rs 125.85 apiece. In traded volume terms, 451 lakh shares have exchanged hands on BSE, while 69.48 crore units traded on NSE. The Rs 9,375-crore IPO was sold in a price band of Rs 74-76 a share during 14-16 July. The mega public issue of the food-tech unicorn saw a subscription of over 38 times, receiving a robust response from all pockets of investors. Zomato’s IPO is the first Indian internet unicorn to make its stock market debut. This much-awaited public issue is the largest to hit Dalal Street since SBI Cards and Payment Services’ Rs 10,341-crore IPO in March 2020.

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Highlights

    16:55 (IST)23 Jul 2021
    Zomato has a lot of room for growth

    Zomato has secured a strong listing gain due to investors’ demand, overall positive equity market sentiment, market share of the company in the online food delivery segment. Better financial performance can be expected in the future. Investors’ confidence seems boosted after Zomato received a strong response from anchor investors and managed to raise Rs 4,196.51 cr. Food services industry only contributes about 8%-9% to the food market in India as compared to US and China contributes approx 40%-50% of the food market. Therefore, Zomato has a lot of room for growth, but a lot of the listing gains can be attributed to current investor sentiments in the market. Palka Chopra, Senior Vice President, Master Capital Services

    15:38 (IST)23 Jul 2021
    Zomato ends 8% above listing price

    Zomato ended the first day of trade 8% above the listing price. The stock performed marked a healthy listing day, refusing to hover anywhere near the IPO price. 

    15:34 (IST)23 Jul 2021
    Zomato ends first day of trade

    Zomato's share price closed the first day of trade at Rs 126 apeice, jumping 66% from IPO price of Rs 76. On closing Zomato had a market capitalization of Rs 98,221 crore.

    15:22 (IST)23 Jul 2021
    Zomato’s business model is neither innovative nor ground-breaking

    Aswath Damodaran argues that Zomato’s business model is neither innovative nor ground-breaking but resembles other such platforms across the world. “The allure to investors comes from Zomato’s core market in India, and the potential for growth in that market,” he said. Food delivery service penetration in India is low when compared to markets such as the United States and drastically low when compared to China. “The Zomato story, or at least the upbeat version of it, is that the Indian food delivery/restaurant market will grow, as Indians become more prosperous and have increased online access,” he added.

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    15:13 (IST)23 Jul 2021
    Won't be surprised to see new tech firms on Nifty 50

    "Zomato's listing today and the day 1 premium indicates the India tech story is beginning to get its due share from public markets and retail investors who have been, so far, shy of participating in it. 2020 -2021 will go down in India's history as the years of furious digital adoption across income classes and size of businesses and the beginning of a correction in representation on the public markets. I would not be surprised to see Nifty 50 featuring at least 10 such new tech companies aggregating at least 8 lakh crore market cap in the next 3 years," said Anup Jain, Managing Partner, Orios Venture Partners.

    15:06 (IST)23 Jul 2021
    More homegrown startups to list soon

    “Zomato going public and the stellar listing is a landmark event for the Indian startups and capital markets. It will be the beginning of a new era where the capital markets will welcome new age, innovative companies to raise capital and share the wealth. This will also serve as an inspiration for many other companies to list in India rather than going abroad. There will be many more IPOs in the next few months/ years from homegrown consumer internet and technology companies. I believe there is sufficient investor appetite for all of these IPOs," said Subramanya SV, CEO & Co-Founder, Fisdom -- a wealth-tech platform.

    15:00 (IST)23 Jul 2021
    Positive with long-term view

    "Zomato listed at a considerable premium which was above the grey market expectation of 15-20% listing gains. We attribute this primarily to a high level of interest from the institutional buyers, leading to a lower float available for traders. We are positive on the long term prospects of the company," said Siddhi Acharya, Research Analyst, Choice Broking.

    14:46 (IST)23 Jul 2021
    Tribute to Indian entrepreneurship

    “The stellar debut of Zomato on the domestic bourse after attracting robust subscription is a testimony to the fact that investors are willing to bet big on new-age technology companies which have the characteristics of a disruptive business model. It is also a tribute to Indian entrepreneurship. With growing internet penetration and the number of smartphone user base increasing month after month, the entire private digital ecosystem will enable wealth creation and further deepen of our capital market in the coming years," said S Ramesh, Managing Director and  CEO, Kotak Mahindra Capital Company.

    14:40 (IST)23 Jul 2021
    Zomato trumps Info Edge in M-cap

    Newly listed Zomato has a market capitalization of Rs 97,907 crore on Friday afternoon, significantly higher than the Rs 66,300 crore market cap of Info Edge. Info Edge, an investor in Zomato, trimmed its stake in the food delivery giant through the IPO. 

    14:34 (IST)23 Jul 2021
    Why Rakesh Jhunjhunwala is not keen on Zomato?

    Big Bull Rakesh Jhunjhunwala is no fan of Zomato and is not looking to hop on the bandwagon. Earlier last week the ace investors said that he sees 20% upside but 60% downside potential for Zomato. “It is not my party, I do not go there. This party will get spooked at some stage,” he added.

    14:13 (IST)23 Jul 2021
    People were worried on steep valuations but stock market IPOs works on sentiment than valuations

    Zomato made a stellar stock market debut as expected because of its strong brand name and its connection with people. People made 75% listing gains. We predicted the same in the last column. A lot of people were worried on steep valuations but stock market IPO's works on sentiment than valuations. Rajesh Singla, founder CEO, unlisted shares platform Planify India

    14:07 (IST)23 Jul 2021
    Post Zomato's bumper listing, short term investors can book profit while long-term investors book part profit

    Zomato listed on bourses at a premium of ~50% against the issue price of Rs. 79. Given strong network effects, increasing frequency of orders  and the large addressable market we remain positive for long-term prospective. However post the robust listing, short term investors can book profit while the long-term investors can book partial profit. Shikher Jain, Equity Research, Anand Rathi Shares and Stock Brokers

    13:47 (IST)23 Jul 2021
    Zomato shares overpriced? Valuation guru Aswath Damodaran estimates true value at Rs 41 only

    Zomato’s stock market debut has ushered in a new era for Dalal Street with new-age technology unicorns on offer for domestic investors; however, value investors are not vying for this piece of the cake. Aswath Damodaran, one of the world’s top valuation gurus, values Zomato at just Rs 41 per share — significantly less than both IPO price as well as listing price. Aswath Damodaran, Professor of Finance at Stern School of Business, NYU, believes the stock is too expensive, considering the loss-making entity it is right now.

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    13:35 (IST)23 Jul 2021
    Book part profits; buy back if you get an opportunity for reinvestment

    Since the stock has been listed at a better than expected price, we would advise investors to book partial profits. They can always buy back if they get an opportunity for reinvestment. Gaurav Garg, Head of Research, CapitalVia Global Research

    13:24 (IST)23 Jul 2021
    Hold the remaining portion for long-term; massive growth opportunity for Zomato in coming yrs

    The remaining portion can be held for the longer-term. Over the years, the financials of the company have definitely seen an improvement. Zomato charged 75% more on delivery and earned 44% more commission in the previous fiscal. This was mainly due to a rise in orders, and fall in discounts. The food or restaurant business in India only accounts for 10% of India's spend on food. Due to urbanization, increase in choice, and convenience, there is a massive growth opportunity for Zomato in the coming years, INDmoney said in a report

    13:18 (IST)23 Jul 2021
    Zomato IPO allottees must book partial profit

    Zomato has seen a bumper listing on the exchanges after it saw a very strong demand during its IPO which concluded last week. The bumper rally post listing has made the valuations even steeper. Zomato’s shares are now trading at Price to Sales of more than ~45 per share (based on FY21 data). As the online delivery space remains under-penetrated in India, Zomato is expected to command a higher valuation in India (due to scarcity premium). However, given such a huge run-up, we believe that investors who received allotment should book partial profit, INDmoney said in a report

    13:11 (IST)23 Jul 2021
    Zomato must demonstrate improvement in profitability in coming quarters

    A key factor for the stock price to sustain this euphoria is to demonstrate improvement in profitability in the coming quarters. The company is highly expected to turn into profit from current loss, else the performance will be impacted. Vinod Nair, Head of Research, Geojit Financial Services

    13:01 (IST)23 Jul 2021
    Zomato's new and existing investors can accumulate on short to medium-term basis

    For successful IPO allocation, though the listing is much above the expectations, current investors can hold on their shares as this new business is forecasted to grow at higher digit in the early stage of the cycle. New and existing investors can accumulate on a short to medium-term basis, as the trend of stock price stabilizes. Vinod Nair, Head of Research, Geojit Financial Services. 

    12:52 (IST)23 Jul 2021
    Zomato's valuations expensive as compared to global peers

    Considering the valuations compared to the global peers it looks expensive but there is tremendous opportunity to grow the business considering the large market opportunity available in India. Saurabh Joshi Research Analyst at Marwadi Shares and Finance

    12:48 (IST)23 Jul 2021
    Zomato's long-term growth story intact; book profits on the invested amount

    Zomato IPO has been listed in line with expectations and we recommend investors to book profits on the invested amount and stay invested for the gains. The listing on higher levels has further stretched the valuations. The company’s continuous focus on unit economics and growth at the same time by investing in new products and technologies keeps the long-term growth story intact. Saurabh Joshi Research Analyst at Marwadi Shares and Finance

    12:44 (IST)23 Jul 2021
    Zomato investors must continue to hold while for fresh investment look for declines

    One can continue to hold and for fresh investment look for declines when the broader markets correct and give an opportunity. Vikas Jain, Senior Research Analyst, Reliance Securities

    12:40 (IST)23 Jul 2021
    Zomato's growth, profitability after initial cash burn to improve going ahead

    Zomato had a super listing on the bourses, as given the low penetration, just two large players in the market, falling advertising costs and company’s focus on the domestic market, growth as well profitability after initial cash burn will improve going ahead. Vikas Jain, Senior Research Analyst, Reliance Securities

    12:32 (IST)23 Jul 2021
    Zomato IPO allotees book partial profits

    Since the stock has been listed at a better than expected price, we would advise investors to book partial profits. They can always buy back if they get an opportunity for reinvestment. Gaurav Garg, Head of Research, CapitalVia Global Research

    12:31 (IST)23 Jul 2021
    Zomato performance boosted by Jubilant FoodWorks Q1 results

    Zomato has advanced the listing of stock by 4 calendar days (2 working days) which created more euphoria among investors. This also got coupled by spectacular results by Jubilant FoodWorks. Zomato got listed at 115 per share which is a premium of 51%. During the trade so far, the stock price reached a high of 138.90. Gaurav Garg, Head of Research, CapitalVia Global Research

    12:22 (IST)23 Jul 2021
    Never been so excited and indifferent at the same time: Deepinder Goyal
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    12:09 (IST)23 Jul 2021
    Zomato's listing performance to provide a positive signal to Indian start-up ecosystem

    Zomato debuted in the Indian market with a strong listing gain of more than 50%. Stock price has further jumped to 138 after a strong listing, making a debut to a club of one lac crore of market cap. This signifies a strong risk appetite for the new and next generation business models. Today’s listing performance will provide a positive signal to the Indian start-up ecosystem. We could see this trend to continue in the upcoming IPOs, as the present market conditions are conducive for the primary market. Naveen Kulkarni, Chief Investment Officer, Axis Securities

    12:07 (IST)23 Jul 2021
    Zomato share price in noon deals

    Zomato shares were seen trading at Rs126.15 apiece, up 9.7% from listing price, and 66% from the IPO price in the noon deals

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    11:49 (IST)23 Jul 2021
    Zomato allotted investors book partial profits, wait for a strong dip below 100 to start accumulating again

    Even though a bumper listing for Zomato was expected, the current valuations seem to be extremely overstretched. This would be marked as a great day for the food tech sector but the real test for Zomato would begin now. How quickly Zomato can start its journey to becoming a profitable company, and gain further market share will truly determine its future. Allotted investors are advised to book partial profits and wait for a strong dip below 100 to start accumulating again. Pavitraa Shetty, Co-founder & Trainer, Tips2Trades

    11:37 (IST)23 Jul 2021
    Not a historical moment, Deepinder Goyal says

    "A lot of people are calling this a ‘historical moment’. It is not. History is always made in hindsight. Never in the present. Back to work," Deepinder Goyal said in a tweet.

    11:36 (IST)23 Jul 2021
    Zomato share price still at 64% premium over IPO price

    Zomato share price was trading at Rs 124.60 apiece on BSE, a 64 per cent premium over IPO price in late morning deals.

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    11:23 (IST)23 Jul 2021
    Zomato a good bet from long term perspective

    Zomato with first-mover advantage is placed in a sweet spot as the online food delivery market is at the cusp of evolution. It has consistently gained market share over the last four years to become the category leader in India in terms of GOV (Gross Order Value). It enjoys couple of moats and with economics of scale started playing out, the losses have reduced substantially. Though, predicting the growth trajectory at this juncture is little tricky, but it’s a good bet from long term perspective. Sneha Poddar, Research Analyst, Broking & Distribution, Motilal Oswal Financial Services

    11:21 (IST)23 Jul 2021
    Zomato, first-of-its-kind listing in markets

    Zomato, India’s leading online food delivery company, listed strongly on the exchanges today with 53% premium at INR 116/Share against its issue price of Rs76/share. Such a stellar debut on exchanges led to its market capitalization crossing Rs1 lakh crore. Despite the large size of IPO at Rs 9,375 crore and rich valuations, the company saw healthy overall subscription of 38x. There is a lot of fancy for such unique and first-of-its-kind listing in the market. Sneha Poddar, Research Analyst, Broking & Distribution, Motilal Oswal Financial Services

    11:18 (IST)23 Jul 2021
    Zomato: Short-term investors can book listing gains and exit; long-term investors can book partial profits

    The Zomato IPO received a great response from investors and was subscribed ~ 38 times which translated to a blockbuster listing for the stock. The stock listed at more than a 50% premium to the issue price of Rs. 76 and continued to move up from there given strong demand. We had given a subscribe rating to the IPO. Given a strong delivery network, high barriers to entry, expected turnaround and significant growth opportunities in tier-II and tier-III cities we continue to remain positive on the stock from a long term perspective. Post the stellar listing, we recommend that short-term investors that were looking for listing gains can exit the stock while long-term investors can book partial profits. Jyoti Roy - DVP- Equity Strategist, Angel Broking

    11:14 (IST)23 Jul 2021
    Zomato's business model has been slower to evolve

    The share of the equity owned but the original founders of the company has dropped dramatically over time, as the company has had to raise capital to fund its ambitious growth agenda, and Deepinder Goyal owns only 5.55% of the company's shares, prior to the IPO. Uber's ownership in Zomato is a result of Zomato's acquisition of Uber Eats India, where Uber received a share of Zomato's equity in exchange. As revenues have grown, the business model for the company has been slower to evolve, as the company has reported extensive losses along the way. Aswath Damodaran

    11:05 (IST)23 Jul 2021
    Zomato tweets 'from 'one day' to 'day one'
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    10:54 (IST)23 Jul 2021
    New-age economy stocks with over 100x P/E ratio poised to enter Nifty 50

    New large-cap internet platform companies like Zomato with high free float market cap due to zero promoter holdings could be serious contenders for entry into the benchmark indices going ahead. ICICI Direct

    10:48 (IST)23 Jul 2021
    Wait and watch how the competitive landscape evolves for Zomato

    This cannot get any better for Zomato as it was great IPO timing for them. The economics of this business suddenly look good for recent periods as they shifted from the luxury category to the necessity category. Patience is the greatest moat for investors – We would personally like to wait and see how the competitive landscape evolves and how Zomato Pivots/grows into other streams. Aditya Kondawar, Founder, COO, JST Investments

    10:47 (IST)23 Jul 2021
    FY21 numbers are skewed, a lot of restaurants are dependent on platforms for their survival

    The market cap of Zomato is now at Rs 90000Cr+ which translates into 'Only' 42.5 times FY21 sales. The IPO was highly successful, with massive amounts of bids and massive premium listing. The JST View is the same like before. We believe that FY21 numbers are skewed as a lot of restaurants are dependent on platforms for their survival. Hence we see more commissions charged to restaurants, more delivery charges applied to customers, and lesser of discounts. Aditya Kondawar, Founder, COO, JST Investments

    10:30 (IST)23 Jul 2021
    Zomato shares hit 20% upper circuit soon after bumper listing

    Zomato share price hit 20 per cent upper circuit at Rs 138 on BSE, soon after bumper listing.

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    10:29 (IST)23 Jul 2021
    Trading volume surges in Zomato shares

    Trading volumes surged in Zomato as 3.25 crore shares have exchanged hands on BSE, while 47.97 crore units traded on NSE, so far

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