The day when Zomato shares hit a lower circuit of 20 per cent for the first time, the rival Swiggy did fundraising of $700 million and the valuation now stands at $10.7 billion. However, with Monday’s decline, Zomato’s valuations stood at $9.5 billion. Both companies at present have a market share of 45 per cent each. 

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In July 2021, Zomato had listed its shares over 50 per cent premium to Rs 116 per share on the exchanges as compared to the upper end of issue price at Rs 76 per share. During the same time, even Swiggy had raised funds at the valuations of $5.5 billion, and in the last 6 months, it has doubled. 

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The food aggregator company was expected to raise funds at the valuations around $10 billion by November-December 2021, however, it has got an extra $0.7 billion in the valuations.  

According to Zee Business research, both companies are gradually expanding their businesses, mainly in the grocery segment. Swiggy in December had mentioned that it is likely to infuse around $700 million in its grocery subsidiary Instamart and perhaps, the fundraising is also for the same. 

While Zomato is also expanding in the same category and has invested around $100 million in grocery delivery startup Grofers.  

Both the companies are in good space with respect to market share and a huge rally is estimated in the whole space. At present, the food delivery business in India is around $4-5 billion and in the next 5-6 years, a 30-40 per cent year-on-year growth is expected in this segment.  

Zomato, after cracking for around 20 per cent on Monday, has recovered by almost 9 per cent intraday on Tuesday. The stock today touched a new record low of Rs 84 per share for the first time and had touched a 52-week high of Rs 169 per share on November 16, 2021.