Zomato shares rally over 18% after reporting 75% YoY increase in revenue
- Zomato's share rose 18.6% to Rs 67.6 on Tuesday
- The company posted a net loss of Rs 359 crore for the quarter ending March 2022
- The company's consolidated revenue from operations increased by 75% year on year to Rs 1,212 crore
Zomato shares rose more than 18% in early trade on Tuesday after the business reported results for the March 2022 quarter.
For the quarter ending March 2022, the company posted a net loss of Rs 359 crore, almost double the loss of Rs 134 crore posted in the same time the previous year.
Conversely, in the fourth quarter of 2021-22, the company's consolidated revenue from operations increased by 75% year on year to Rs 1,212 crore, up from Rs 692 crore the previous year.
After the increase in revenue, Zomato's stock rose 18.6% to Rs 67.6 on Tuesday. On Monday, the stock closed at Rs 57. The stock had its greatest intra-day gain since its initial public offering.
Because of the outstanding intraday surge in the counter, the new-age digital platform's market value has now reached Rs 50,000 crore after a long time.
According to a regulatory filing, Zomato's adjusted EBITDA loss decreased to Rs 220 crore (-15% of adjusted sales) in Q4 FY22 from Rs 270 crore (-19% of adjusted revenue) in Q3 FY22.
Zomato shares were still 15% below their offering price of Rs 76 when they were listed in July 2021. Furthermore, the counter has fallen around 66% from its all-time high of Rs 169.10.
Morgan Stanley maintains an 'overweight' rating on the company, with a target price of Rs 135 per share.
The fourth-quarter results were consistent with increased transparency in segment disclosures. The corporation provided a more optimistic prognosis for the first quarter and a more stringent framework for capital allocation.
According to CNBC-TV18, the firm is on the right track but requires constant execution to achieve high expectations.