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Decoding Investment Decisions: Evaluating Company Performance : Zomato's Q1 Profits seen there good growth. Should you buy?

 Hello Dear Readers, 

The food delivery platform reported a consolidated net profit of Rs 2 crore for the quarter ended June 2023 against a loss of Rs 186 crore in the corresponding quarter of the last financial year. The company reported a loss of Rs 189 crore in the quarter ended March.

Zomato's first-ever quarterly profit triggered sharp interest in the stock, with investors rushing to lap up shares as soon as the markets opened on Friday. Nearly 5.25 crore shares changed hands in the opening trade on the NSE, catapulting the stock price by over 8% to its 52-week high of Rs 93.65.

While the June quarter earnings were announced during the fag of Thursday's trading session, the stock responded immediately and jumped 2%. 

Jefferies: Buy | Target: Rs: 130
We sharply raise Ebitda and revised the price target to Rs 130. The brokerage has a 'Buy' rating. A positive net profit in the April-June quarter was way earlier than the guidance and this puts to rest all the concerns around Zomato's ability to make 'respectable' profits. Calling it a "journey of dramatic twists and turns since the IPO", Zomato achieved a key milestone of adjusted Ebitda and consolidated PAT positive.

The brokerage also lauded the company's management while vouching for its credibility and its execution prowess, which is particularly positive for Blinkit which most investors ascribe zero (or negative) value.

Nuvama: Buy | Target: Rs 110
Zomato reported strong Q1FY24 results which were much ahead of expectations, Nuvmam said. The domestic brokerage maintains a ‘Buy’ with a revised DCF-based target price of Rs 110 from an earlier target of Rs 94.

Motilal Oswal: Buy | Target: Rs 110
Motilal Oswal remains positive on the long-term growth opportunity for Zomato and does not expect competition to intensify further despite the entry of ONDC in the space. "Our DCF-based valuation of Rs 110 suggests a 27% upside from the current price. We reiterate our BUY rating on the stock," the brokerage said.










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