Zomato has its worst day in nearly a year as stock tumbles towards 52-week low

The Zomato stock hit the day’s low of Rs 44.35 on the BSE on Wednesday compared to its previous close of Rs 52.10. The stock also saw a surge in trading volumes with the number of shares changing hands on the BSE by noon rising to 2.8 times.

Notably, the stock is down over 52 percent in the past year. It hit its 52-week low of Rs 40.60 on July 27, 2022, after the one-year lock-in period for pre-IPO (initial public offering) shareholders ended on July 23, 2022.

Zomato on Tuesday announced that it was relaunching its loyalty program Zomato Gold – its fourth iteration in the last few years. With a starting price of Rs 149 for three months, Zomato Gold will replace Zomato Pro and Pro Plus, which were suspended in August 2022.

As per notifications sent to users, Zomato Gold will offer free delivery for all orders above Rs 199 and at all restaurants less than 10 km away. There are also benefits such as a ‘No Delay Guarantee’ where members will receive a Rs 100 coupon for delayed deliveries. For dining in, members will get up to 40 percent off at more than 10,000 partner restaurants across the country.

Earlier this week, Zomato also said that it was working on rebranding its 10-minute food delivery service, Zomato Instant, which was launched in March 2022. The clarification came after news surfaced that Zomato was shutting down the service. But, the company confirmed in a statement that it was only working on rebranding it.

Earlier this week, HSBC Securities and Capital Markets (India) in its research report said that Zomato’s gross order value (GOV) growth was likely to be subpar in the third quarter of the current fiscal year. The brokerage added that slow industry growth and strong competition from Swiggy may adversely impact Zomato’s growth during the period.

Shares of Zomato are trading 6.62 percent lower at Rs 48.65.