Zomato share price falls 6% after Q4 results. Opportunity to buy the stock?

The meals supply platform Zomato reported a consolidated web revenue of ₹175 crore within the fourth quarter of FY24 as in opposition to a lack of ₹188 crore in the identical interval a yr in the past. The online revenue grew 27% from ₹138 crore posted within the December quarter.

Zomato’s income from operations in Q4FY24 elevated 73% to ₹3,562 crore from ₹2,056 crore, YoY. Gross order worth (GOV) for the March quarter grew throughout B2C companies rising to 51% YoY to ₹13,536 crore.

On the working degree, the corporate posted an EBITDA of ₹86 crore, an enchancment from the lack of ₹226 crore incurred throughout the identical interval final yr.

Learn right here: Zomato This fall outcomes: Internet revenue at ₹175 crore versus lack of ₹188 crore YoY; 5 key highlights

Zomato’s fast commerce arm Blinkit achieved operational EBITDA break-even in March 2024.

Analysts maintained their bullish view on Zomato shares with some elevating goal worth on the inventory led by continued outperformance of Blinkit.

Right here’s what analysts stated on Zomato This fall outcomes and Zomato share worth:

Emkay World Monetary Companies

Zomato posted regular operational outcomes, with income forward of Emkay World’s estimates whereas the margin miss was on account of upper than anticipated ESOP prices.

The brokerage agency has principally retained FY26E earnings per share (EPS) estimates, however lowered FY25E EPS by ~20%, factoring within the slower profitability for Blinkit on the aggressive retailer addition plan and better ESOP prices. 

It maintained a ‘Purchase’ ranking with Zomato share worth goal of ₹230 per share on SOTP foundation, valuing meals supply at ₹121 per share (DCF foundation), Blinkit at ₹93 per share (DCF foundation), and money & different investments at Rs17 per share (BV).

Additionally Learn: Varun Drinks share worth jumps over 5% buoyed by Q1 outcomes

Nuvama Institutional Equities

Blinkit plans to lift darkish retailer depend from 525 in Q4FY24 to 1000 by finish of FY25. Whereas this shall affect short-term profitability, this shall cement Blinkit because the clear chief in fast commerce, Nuvama Institutional Equities stated.

It values Zomato utilizing SOTP, valuing meals supply at $10 billion and Blinkit at $13 billion. The improve was as a result of enhance in worth of Blinkit on account of faster-than-expected progress and clear management in fast commerce. 

Nuvama maintained a ‘Purchase’ ranking on Zomato shares and raised the goal worth to ₹245 per share from ₹180 earlier.

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Elara Capital

Elara Capital stated it continues to favor Zomato on its robust moat within the meals enterprise, which can proceed to put up an adjusted EBITDA CAGR of 47% in FY24-26E, and superior execution for Blinkit (market management), helped by higher buyer expertise versus friends (on-time supply, higher product assortments). 

It raised consolidated income estimates by 22% and 33% for FY25E and FY26E, led by higher progress for Blinkit/Hyperpure. However its FY25E and FY26E consolidated earnings improve is mere 7% and three%, on greater ESOP prices and decrease EBITDA for Blinkit (latter’s focus is growth). 

The brokerage maintained ‘Purchase’ ranking and raised Zomato share worth goal to ₹280 apiece from ₹250 earlier.

At 9:20 am, Zomato shares had been buying and selling 4.96% decrease at ₹184.10 apiece on the BSE.

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Disclaimer: The views and suggestions made above are these of particular person analysts or broking firms, and never of Mint. We advise traders to verify with licensed specialists earlier than making any funding choices.

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Printed: 14 Could 2024, 09:23 AM IST