New Delhi, July 23: India-based food delivery company Zomato made a stellar debut on Dalal Street on Friday as the stock opened at Rs 116 on the National Stock Exchange (NSE), a 52.63 per cent premium to its final offer price of Rs 76.
The listing price on the Bombay Stock Exchange (BSE) was at Rs 115, up 51.32 per cent. Stock of Zomato ended the day at Rs 125.20 on BSE and Rs 125.30 at NSE.
Zomato, which was started in 2010 by its promoter Deepinder Goyal crossed Rs 1 lakh crore mark of the market capitalisation, as it stood at Rs 1,08,067.35 crore after a stellar debut on Dalal Street, racing ahead of IOC, BPCL and Shree Cements.
“A lot of people are calling this a ‘historical moment’. It is not. History is always made in hindsight. Never in the present. Back to work,” Deepinder Goyal tweeted after successful listing.
“Zomato debuted in the Indian market with a strong listing gain of more than 50 per cent. Stock price has further jumped to 138 after a strong listing, making a debut to a club of one lakh crore of market cap. This signifies a strong risk appetite for the new and next generation business models. Today’s listing performance will provide a positive signal to the Indian start-up ecosystem. We could see this trend to continue in the upcoming IPOs, as the present market conditions are conducive for the primary market,” said Naveen Kulkarni, Chief Investment Officer, Axis Securities.
“Such stellar debut on exchanges led to its market capitalization crossing Rs 1 lakh crore. Despite the large size of IPO at Rs 9,375 crore and rich valuations, the company saw healthy overall subscription of 38x. There is lot of fancy for such unique and first of its kind listing in the market. Zomato with first mover advantage is placed in a sweet spot as the online food delivery market is at the cusp of evolution. It has consistently gained market share over the last four years to become the category leader in India in terms of gross order value,” said Sneha Poddar, Research Analyst, Broking & Distribution, Motilal Oswal Financial Services Ltd.
“It enjoys couple of moats and with economics of scale started playing out, the losses have reduced substantially. Though, predicting the growth trajectory at this juncture is little tricky, but it’s a good bet from long term perspective,” she added.
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