Okay so, Zomato has filed a DHRP today and has planned to raise approx 8.5k crores that eventually means the company is considering itself as am mid cap company and when it comes to small and mid cap, the answer to investing always remains YES.
Though, zomato's top line for the last financial year is somewhere between 2.5k crores however, the bottok line has the same amount of loss as well. For now, this is a major concern and we will have to wait for the management view about how they will turnaround things.
Online food delivery sector is expected to grow by 30% YOY which means that the players involved in such sector will also grow. Growth is life and we ahould always be ready to grow!
P. S-These are my own views and not a trigger to buy/sell/hold.
Please do your own study and make an informed financial decision.
Please share/upvote if you loved reading the answer.
The IPO is backed up by marquee investors like Info Edge, Temasek, Ant Financial, and Tiger Global, among others. The company is into internet economy —- considered to be the business model of the future.
In the past many such companies, continued to grow and given investors with 5x, 10x, or more kind of returns.
The details of IPO, the pricing, the P/E or growth prospects we will only know when the actually IPO comes in.
However, the risk element for all such IPOs is relatively higher compared to the traditional companies. It takes no time that success is transformed in failure. Generally such companies run into huge losses and they hardly have visibility of showing profit in near future.
So, any such investment should be done with all the risk elements in view.
Shares of Zomato zoomed on listing, jumping nearly 63 per cent to trade at Rs 124, against its issue price of Rs 76. The stock made its debut at Rs 115, reflecting a huge gain of 51.31 per cent against the issue price on the BSE. It then hit a high of Rs 138, a jump of 81.57 per cent. On the National Stock Exchange, it got listed at Rs 116, registering a premium of 52.63 per cent. Zomato's initial public offering (IPO) last week ended with a bumper 38 times subscription. While the stock made its debut at the price of Rs 115, it is currently trading at Rs 124, which is a robust 63% over and above the offer price. by TaboolaSponsored LinksYou May Like Treppenlift 2021: Staat gibt aktuell unfassbaren Zuschuss treppenlift-angebotsvergleich.de Abnehmen und trotzdem grillen? ww.com Should you buy the Zomato stock now? Says Sneha Poddar, Research Analyst, Broking & Distribution, Motilal Oswal Financial Services Ltd, "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 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 38 times. There is lot of fancy for such unique and first of its kind listing in the market. 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." We at goodreturns.in believe that the stock is overpriced at these levels, as there are risks to the business as well. Some of these players have had problems with restaurants in the past. The IPO price was still reasonable, but, to buy the stock at Rs 124 is overexuberrance. We suggest investors to stay away and wait for the stock to decline to buy. Having said that, there is little doubt that the brand of zomato is solid. However, at these levels the stock is not a good buy. Zomato IPO received good response The IPO had opened for subscription on July 14, in a price band of Rs 72-76 per share. It closed on July 16. The company, backed by Jack Ma's Ant Group Co, is the first from a long list of Indian unicorn startups to launch an IPO. It is also the first among Indian online food aggregators. The Zomato IPO comprised a fresh issue of equity shares worth Rs 9,000 crore and an offer-for-sale (OFS) worth Rs 375 crore by existing investor Info Edge (India), which is the parent company of Naukri.com, according to the information provided in the draft red herring prospectus. Disclaimer Investing in stocks is risky and investors need to be cautious. Neither Greynium Information Technologies Pvt Ltd, nor the author, nor the brokerage house mentioned would be responsible for any losses incurred based on decisions made from the article. Investors are also advised caution as the markets are now at a record high. Please consult a professional advisor and avoid investing lumpsum amounts.
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