Zomato’s share price slumped over 6% on Tuesday to hit an intraday low of ₹60.30. Prior to this week, the stock had climbed 25% in the past month.
What Happened: Zomato’s share price continued its three-session losing streak on Tuesday. The reason behind the drop was not immediately clear but could be a result of investors looking to book profits after the stock’s recent bull run.
The slump also comes as US-based investment manager Invesco marked down the valuation of Indian food delivery giant Swiggy by about 30% to ₹45,012 crore. With the downgrade, Swiggy’s valuation dipped below that of Zomato, which currently has a market cap of ₹52,281 crore. This is the second time the US investor has slashed Swiggy's valuation since October last year.
The downgrade seems to have affected investors’ view of Zomato as well. However, most brokerages have remained positive on the stock. Domestic brokerage firms ICICI Securities and Motilal Oswal have a ‘buy' rating on the stock. ICICI Securities has a price target of ₹65 on the stock, while Motilal Oswal has a target price of ₹70 for the stock.
Price Action: Zomato’s share price was down 5.39% to close at ₹61.40 on Tuesday.
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