Jefferies reiterates a Buy rating on Zomato, setting a target price of ₹335. The brokerage highlights Zomato’s launch of the ‘District’ app, envisioned as a comprehensive platform for dining-out and ticketing services. Management anticipates that this initiative will drive growth over the next decade, with plans to introduce additional features and services.
The dining-out and ticketing market is currently nascent, similar to the early stages of food delivery and quick commerce. Zomato aims to capitalize on this emerging opportunity, addressing a market that is presently supply-constrained.
Recent Developments:
Zomato expects its food delivery business to grow at an annual rate of 30% over the next five years, driven by increased competition and innovation in the sector. The company holds a 58% market share, compared to Swiggy’s 34%. In the last fiscal year, Zomato’s gross order value reached ₹32,224 crore ($3.82 billion), maintaining a 30% annual growth rate over the past four years.
However, Zomato’s CEO, Deepinder Goyal, faced criticism for a controversial job advertisement requiring a ₹15 lakh fee with no salary for the first year. The ad was intended to filter candidates genuinely interested in the opportunity, but it was perceived as elitist and unfair. Following backlash, Goyal clarified that the fee was never meant to be enforced.
