Zomato share price: The stock has corrected almost 15 percent in the past five sessions and has slipped below its listing price. Zomato’s market cap is also down to Rs 89,537.06 crore as against over Rs one lakh crore at the time of its strong market debut.
Zomato shares plunged more than 12 percent to a record low of Rs 112.55 in intraday trade on Friday. After continuous selling in the past four sessions, the stock fell below its listing price for the first time since its secondary market debut in July 2021.
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At close, Zomato stock was down 8.90 percent lower at Rs 114.10 on the Bombay Stock Exchange (BSE). At the 52-week low level (Rs 112.55), the shares of the food delivery platform traded 2 percent lower than the listing price of Rs 115.
The stock has corrected almost 15 percent in the past five sessions. Zomato’s market cap is also down to Rs 89,537.06 crore as against over Rs one lakh crore at the time of its strong market debut.
Even as the food tech firm made a stellar debut and its stock rallied 47 percent since listing to an intraday high of Rs 169.10 on November 16, 2021, it has overall corrected more than 9 percent since July 21, the day of listing.
The downtrend in Zomato shares came amid an overall negative trend in the market. However, recent concerns about new-age companies, have led to Zomato’s peers like PB fintech, CarTrade, and even Nykaa, which had a blockbuster debut, also witness profit booking.
Paytm shares too have witnessed a sharp correction falling to fresh lows in the recent days. On Friday, the stock ended 3.5 percent lower at Rs 960.
According to market expert Prakash Diwan, “if there is a possibility of Zomato or PB Fintech creating value, it's fairly long in terms of the horizon…So, there's nothing very compelling about the IPOs themselves in the first place and the reality is kind of sinking in now.”
He added when liquidity becomes a doubtful parameter, one starts to look at fundamentals. “None of these teams actually have that conviction to back themselves up,” he said.
Earlier this month, Envision Capital's Nilesh Shah had said he was positive on new-age businesses but advised investors to wait for a "weak phase" before buying into the emerging space.
Shah told CNBC-TV18 on January 4 that one needs to wait for a while for "some kind of an interval or interruption to price momentum" since their IPOs. He thinks it is best to wait for "that weak moment, that weak phase" when some of these companies may report a weak quarter or the market itself may give the opportunity to buy.