Zomato share price may rally 21%, says HSBC; grocery business termed ‘poison pill’, check target
Zomato share price may rally 21%, says HSBC; grocery business termed ‘poison pill’, check target Zomato stock price has plummeted 50% so far this year, erasing massive investor wealth as the scrip fell below the IPO price. Despite the fall in stock price, analysts at HSBC have maintained their ‘Buy’ call on the food delivery giant. HSBC has also maintained its target price of Rs 85 per share, which translated to a 21% upside from Wednesday’s opening price. HSBC said that synergies between Zomato’s Food Delivery (FD) and Instant Grocery business are key for the company. The global brokerage firm had upgraded the stock to a ‘Buy’ rating from ‘Hold’ earlier in May this year. HSBC noted that investors are broadly divided on Zomato’s strategy to acquire Blinkit and some even question the merit of foraying into the grocery (hyperlocal) business. Analysts said that building a grocery business will work as a “poison pill” for Zomato. “It would need reasonably high investment and hence cash burn and is likely to be a significant logistical challenge to execute as well, but still Zomato can’t afford not to do it in our view,” they added. Analysts said that Zomato could either go with the quick-commerce model for grocery business with 10-15-minute delivery or with a full kitchen offering that offers delivery the next day. “In our view, Zomato has to attempt to build its grocery business closer to the middle of this framework and leverage technology to design and manage its dark stores so as to offer 4-5K SKUs with 10-60m delivery TAT. Cross-selling to Zomato’s customer base, integrating the tech stack and building fulfilment infrastructure (as above) are top priorities for Zomato to build a successful grocery business, in our view,” they added. The target price of Rs 85 per share implies a 21% upside from Wednesday’s opening price of Rs 70 per share. “Fundamentally, we believe unlike many other segments in the new-tech space, food delivery is relatively mature, with a healthy duopoly structure and clear value proposition,” analysts said.
相关推荐
Redevelopment work of Delhi’s Safdarjung railway station in full swing – Photos
AMC profits dip amid market turmoil, brake in new launches
Adani Enterprises withdraws FPO worth Rs 20,000 Crore; money to be returned to investors
Aircraft safety in focus- Missing washer identified in Boeing 737 Max during DGCA Inspection
Rating- sell; Eicher Motors in the fast lane
ASEAN Defence Ministers’ Meet- Rajnath Singh calls for urgent efforts to counter global terrorism, co-chairs meet with Cambodia’s Dy PM – Check photos here
- 最近发表
- ZEEL, Adani Total Gas among 163 NSE stocks to touch 52-week lows, 17 stocks hit 52-week highs
- Reliance Industries, Landmark Cars, Abans Holdings, IRCTC, Lupin, RailTel, RVNL stocks in focus on 23 December
- Will Sensex, Nifty repeat Nov rally this month- Share market at all-time high; rebalance portfolio - INTERVIEW
- 6 killed in shootout at Virginia’s Walmart store, gunman also dead – Photos
- Wipro, L&T, Tata Power, Bajaj Auto, Maruti Suzuki, Bajaj Finance stocks in focus on weekly F&O expiry
- Aamaar Howrah! Decoding India’s oldest and busiest railway station – Check the history, interesting facts
- Will Nifty gain above 21,800 or dip further- See GIFT Nifty, FII data, F&O ban, crude, more before market opens
- Reliance, Zomato, Infosys, Bajaj Auto, Dr Reddy’s, Axis Bank, Future Enterprises stocks in focus on June 27
- ZED scheme- Financial support extended to MSMEs crosses Rs 100 crore
- All well between JDU and RJD in Bihar- Tejashwi cancels Australia tour after Nitish selected chief
- 随机阅读
- Adani Enterprises’ share price jumps 4% ahead of results today; first earnings report after Hindenburg bomb
- 2024 New Year- Are you aware about 5 major UPI changes- Know all about RBI’s latest modifications
- 2023 downturn- Indian tech startup ecosystem closes year in red across multiple metrics
- After March rout and April recovery in share market, why FPIs turned net buyers in May first week - INTERVIEW
- Adani Enterprises share price jumps 4%, firm joins hands with TotalEnergies to invest $50 bn in green hydrogen
- 6 key themes to help India’s corporate earnings beat emerging markets; check preferred sector stocks to buy
- ACC’S shares gain on Q2 results; Should you buy, hold or sell the stock-
- Alkem Laboratories posts buoyant growth in Q2; Should you buy, hold or sell the stock-
- 52-week high, 52-week low- Coal India among 146 BSE stocks to hit 52-week high; Birla Tyres at fresh low
- AIFs may face borrowing curbs for making investment
- AIMTC urges Centre to relook at the proposed Hit-&-Run Cases under Bharatiya Nyaya Sanhita, 2023
- Adani Total Gas, V-Mart Retail, Gland Pharma among 15 NSE stocks to hit 52-week lows; 50 touch 52-week highs
- 75th Year of Independence Day of India- Beautiful pictures of ‘Tiranga Yatra’ from across nation
- Reliance Home, executives slapped with Rs 21
- Adani Group, Dish TV, Natco Pharma, Bombay Dyeing, CEAT stocks in focus on 20 September
- Adani stocks rout- Country’s regulators are seized of matter, says FM Nirmala Sitharaman
- Recession fears set stocks on course for weekly drop
- Reliance share price falls 0
- Retik Finance (RETIK) price prediction, here’s why $100 is a real possibility for 2024
- uidance range. Ebit margins at 18.2% were down 140bps and missed estimates due to higher-than-expected employee costs. Profits at Rs 39.8 bn were up 11% y-o-y and were slightly ahead of estimates due to a $21m gain booked on the buyback of senior notes in Q4.
Services miss estimates; Software better than expected: Services business grew 0.6% q-o-q cc and missed HCLT’s Q3FY23 guidance, mainly due to a 3.8% q-o-q cc decline in the ER&D segment. Growth in the IT&BS segment moderated slightly to 1.6% q-o-qcc but was in line with estimates. BFSI and Life Sciences were the key growth drivers, while communications were the drag among verticals. Growth was led by the Americas region, while Europe and ROW posted declines.
Decline in bookings reflects delays in decision-making: HCLT won 10 large deals in services and three large deals in Software with net-new deal TCV of $2.1bn, down 8% y-o-y. Deal wins were driven by the services portfolio, were centered on cost optimisation and vendor consolidation and came mainly from BFSI, manufacturing and Life Sciences verticals. Management highlighted a ramp-down in discretionary spending in Hitech and communications verticals but pointed to a strong deal pipeline.
FY24 guidance in line with expectations: HCLT has guided for 6-8% y-o-y growth for overall business and 6.5-8.5% y-o-y cc growth in services segment and 18-19% margins in FY24—all in line with our assumptions. We maintain our FY24-25 cc revenue growth and margin estimates and expect HCLT to deliver 6.5% cc revenue growth and 18.4% margins in FY24. However, we lower our earnings forecasts by 2% to factor the higher tax rate indicated by the management.
Also read: MSME listing: How to migrate from NSE SME platform to main board? Check revised criteria
Raise PT: HCLT has fared better in Q4, particularly in North America and BFSI, unlike its peers. However, rising demand uncertainty as a US recession nears remains a concern. HCLT’s stock at CMP trades at 17x PE and offers a 5% yield, which in our view should limit downsides and derating. Hence, we raise our target PE to 17x (16x earlier) and raise our PT to Rs 1,125, offering 8% potential upside.
- 搜索
- 友情链接