Zomato- Key Insights

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An Overview

In today’s fast-paced world, dining out or ordering in has become more of a lifestyle than an occasional treat. Zomato, a household name for food enthusiasts, has not only revolutionised the way we experience food but has also emerged as a potential investment opportunity. In this blog, we will delve into the history, share price, current performance, and future outlook of Zomato. Additionally, we will explore the advantages of investing in this food tech giant and answer five frequently asked questions about Zomato.

History of Zomato

Zomato, originally known as “Foodiebay,” was founded in 2008 by Deepinder Goyal and Pankaj Chaddah in India. What started as a simple online restaurant directory soon transformed into a comprehensive food discovery and delivery platform. The company expanded its services rapidly, establishing a presence in several countries around the world.

One of the key milestones in Zomato’s journey was its acquisition of Urbanspoon in 2015, which allowed it to enter the highly competitive North American market. Over the years, Zomato continued to innovate and diversify its offerings, including the introduction of Zomato Gold, a subscription-based dining program that offers exclusive discounts and privileges at partner restaurants.

Share Price of Zomato

Zomato had made a historic debut on the Indian stock market. The company’s Initial Public Offering (IPO) was met with immense enthusiasm from investors. Zomato’s shares were listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).

As of September 28, 2023, the share price of Zomato was ₹99.95 on the National Stock Exchange (NSE) of India. The share price decreased by 0.15% or ₹0.15 from the previous day’s closing price of ₹100.101. The share price reached a high of ₹100.35 and a low of ₹99.30 during the trading hours. The total volume of shares traded was 25,885,383 and the total value of shares traded was ₹2,580 crore.

The share price of Zomato is influenced by many factors, such as the company’s earnings, growth, expansion, competition, regulation, and reputation. The company’s earnings per share (EPS) for the quarter ended June 30, 2023 was -₹0.91, which was an increase of 150.19% from the same quarter last year. The company’s net loss for the quarter was -₹3,560 crore and its revenue was ₹9,340 crore. The company’s net loss margin was -38.12%, which means that it lost ₹38.12 for every ₹100 of revenue.

The share price of Zomato can fluctuate significantly due to various factors, including market sentiment, financial performance, and industry trends. It is important to check the latest stock prices and trends before making any investment decisions.

Current Performance

Zomato’s performance in the food delivery industry has been noteworthy. The company’s mobile app and website serve as a one-stop destination for users looking to explore restaurants, read reviews, place food orders, and even make reservations. Zomato’s delivery fleet ensures that food reaches customers’ doorsteps swiftly, enhancing convenience.

In recent years, Zomato has also ventured into the grocery delivery segment to diversify its offerings. This move was particularly timely, given the surge in demand for online grocery shopping during the COVID-19 pandemic. The company’s ability to adapt to changing consumer preferences is a testament to its resilience.

Zomato is involved in various segments such as food delivery, dining out, hyperpure, and zomato pro. The company has been acquiring new customers and markets in these segments to increase its market share and revenue. For example, in August 2023, Zomato announced that it had acquired Grofers, an online grocery delivery platform, for $1 billion.

Future Outlook

The future of Zomato appears promising, driven by several factors. Firstly, the increasing trend of dining out and ordering in is unlikely to wane, making food delivery platforms like Zomato indispensable. Additionally, Zomato’s expansion into adjacent sectors, such as grocery delivery and cloud kitchens, opens up new revenue streams.

Furthermore, Zomato’s presence in multiple countries positions it well to tap into international markets. As it continues to innovate and enhance its services, the company is poised for sustained growth.

Advantages of Investing in Zomato

Investing in Zomato offers several advantages:

  • Market Dominance: Zomato is a market leader in the food delivery industry, enjoying a significant share of the market. This dominance can translate into stable returns for investors.
  • Diversification: Zomato’s foray into grocery delivery and other related services reduces its reliance on a single revenue stream, making it more resilient to market fluctuations.
  • Brand Recognition: Zomato’s strong brand presence and customer loyalty can contribute to sustained growth and profitability.
  • Global Expansion: The company’s global footprint provides opportunities for diversification and growth in emerging markets.
  • Tech-Driven: Zomato’s innovative use of technology in food discovery, ordering, and delivery positions it at the forefront of the food tech industry.

However, it’s essential to remember that investing in stocks carries inherent risks, and past performance is not indicative of future results. It’s advisable to conduct thorough research and consider your financial goals and risk tolerance before investing in Zomato or any other company.

Wrapping Up

In conclusion, Zomato’s journey from a humble restaurant directory to a global food tech giant has been remarkable. While the food delivery industry continues to evolve, Zomato’s ability to adapt, innovate, and expand its services positions it as an enticing investment opportunity. As with any investment, it’s crucial to do your due diligence and consult with financial experts before making decisions.

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Frequently Asked Questions

1. Is Zomato only available in India?

Answer Field

No, Zomato operates in several countries around the world, offering its services in a wide range of international markets.

2. How does Zomato make money?

Answer Field

Zomato generates revenue primarily through commission fees from restaurants for listing on its platform and a percentage of the order value from food deliveries. It also earns revenue from its subscription-based program, Zomato Gold.

3. What is Zomato Gold?

Answer Field

Zomato Gold is a subscription-based dining program that offers exclusive discounts and benefits at partner restaurants. Subscribers can enjoy complimentary dishes and drinks when dining out.

4. What are the risks of investing in Zomato?

Answer Field

Some potential risks include competition from other food delivery platforms, regulatory changes, and market volatility. Additionally, Zomato’s profitability is influenced by factors like customer retention and operational efficiency.

5. Can I invest in Zomato if I’m not in India?

Answer Field

Yes, you can invest in Zomato’s stock if you have access to the Indian stock market through international brokerage accounts. However, you should be aware of any regulatory restrictions and tax implications in your country.

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