Zomato encountered a 6% decline in its shares during early trading on Tuesday following the release of its Q4 results. The stock dropped by up to 5.98% to ₹182.10 each on the BSE. Zomato reported a consolidated net profit of ₹175 crore in Q4 FY24, marking a significant turnaround from the ₹188 crore loss reported in the same period the previous year. This reflected a 27% increase from the ₹138 crore net profit recorded in the December quarter. In Q4FY24, Zomato’s revenue surged by 73% to ₹3,562 crore from ₹2,056 crore YoY, with Gross Order Value (GOV) experiencing robust growth across B2C businesses, climbing by 51% YoY to ₹13,536 crore.
Operationally, the company achieved an EBITDA of ₹86 crore, a notable improvement from the ₹226 crore loss incurred in the same period last year. Zomato’s quick-commerce arm, Blinkit, achieved operational EBITDA break-even in March 2024.
Analysts maintained an optimistic outlook on the company’s future, with some adjusting their target prices upwards, driven by Blinkit’s sustained outperformance. Emkay Global Financial Services acknowledged Zomato’s consistent operational performance, attributing the margin deviation to higher-than-expected ESOP costs. The brokerage retained a ‘Buy’ rating with a share price target of ₹230 per share.
Nuvama Institutional Equities highlighted Blinkit’s expansion plans and their potential impact on short-term profitability, reaffirming Zomato’s leadership in quick commerce. They maintained a ‘Buy’ rating and raised the target price to ₹245 per share from ₹180 earlier.
Elara Capital favored Zomato for its strong presence in the food business, projecting an adjusted EBITDA CAGR of 47% in FY24-26E. They upheld a ‘Buy’ rating and raised the share price target to ₹280 apiece from ₹250 previously.
As of 9:20 am, the company’s shares were trading 4.96% lower at ₹184.10 apiece on the BSE.
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