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Zomato shares jump more than 80% on market debut

Zomato shares jump more than 80% on market debut

Zomato shares jump more than 80% on market debut
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By CNBCTV18.com Jul 23, 2021 2:31:03 PM IST (Published)

Zomato made a stellar debut on Dalal Street as the stock got listed on NSE at Rs 116, a 52.63 percent premium to its issue price of Rs 76.

The share price of food delivery company Zomato rose after the company made a strong market debut at a premium of more than 50 percent to its issue price on Friday.

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At 2:00 pm, the stock was trading at Rs 125.15, 8.83 percent higher than its listing price of Rs 116 and 64.67 percent higher than the issue price on the BSE.
Zomato made a stellar debut on Dalal Street as the stock got listed on NSE at Rs 116, a 52.63 percent premium to its issue price of Rs 76. It was listed at Rs 115, up 51.32 percent, on the BSE.
Soon after the listing, the stock price rallied further and touched a high of Rs 138 on the BSE, 80 percent higher than the issue price. This led to its market cap crossing Rs 1 lakh crore.
This resulted in the company becoming a member of the exclusive club of top 50 companies by market capitalisation. Its market cap surpassed the value of Tata Motors (Rs 98,181 crore), Godrej Consumer (Rs 99,273 crore), Shree Cement, Indian Oil Corporation (Rs 99,695 crore), and BPCL (Rs 99,785 crore).
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“It is a very historical moment for the Indian equity market. It is a very exciting moment and hopefully bodes well for times to come for many such more new listings of new-age technology companies, this would open the doors for those to list going forward,” said Prashant Khemka, founder of White Oak Capital Management.
However, certain analysts cautioned investors about the “extremely stretched and expensive” valuations of Zomato and advised investors to book profits in the stock.
Jyoti Roy, DVP- Equity Strategist, Angel Broking suggested that short-term investors that were looking for listing gains can exit the stock while long-term investors can book partial profits.
“Given a strong delivery network, high barriers to entry, expected turnaround and significant growth opportunities in tier-II and tier-III cities, we continue to remain positive on the stock from a long term perspective,” said Roy.
 
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