Zomato Stock Prospective in 2024: Business Overview, Financial Figures, and appraisal Valuations
In a promising turn of events for the Indian food delivery market, Zomato, listed as Eternal Ltd, has been consistently posting profits for six consecutive quarters. This impressive run has been highlighted in the first quarter of the 2025 financial year, where the company reported an operating profit of Rs 413 crore and a net profit of Rs 253 crore.
The current outlook for Zomato's stock investment and future growth prospects appears cautiously optimistic, with potential for further gains. This optimism is supported by several key factors, including strong institutional backing, healthy price targets, and improving business fundamentals.
Zomato's share price is projected to rise steadily, with forecasts indicating a target range between ₹245.54 and ₹336.85 by the end of 2025 and further growth into 2026, reaching over ₹423 by December 2026. This suggests a strong medium-term upside for investors.
As of July 4, 2025, Zomato was trading around ₹260.85, showing resilience and steady interest among investors. The stock has experienced a significant volume of shares traded, reflecting healthy market activity. The 52-week high stands at ₹304.70, indicating room to grow from current levels.
Morgan Stanley recently reaffirmed Zomato as a top pick in the sector due to its leadership in food delivery and quick commerce, solid cost-efficiency, and strong financial health. They retained a price target of ₹320, implying a potential upside of around 33%, alongside a suggested risk floor of ₹200-220, highlighting an attractive risk-reward balance for long-term investors.
However, some analysts advise caution due to the rapid run-up in price and inherent risks in the competitive e-commerce and food delivery sector. Zomato's stock has rebounded approximately 30% since March 2025, driven by broader market optimism and company fundamentals.
Zomato's business fundamentals have been improving, with the company gradually moving out of losses and showing improvement in operational efficiencies. Its large customer base, consistent app engagement, and expansion into dining and quick-commerce verticals underpin its future growth potential.
One of Zomato's significant moves was the strategic acquisition of Blinkit for Rs 4,447 crore in 2022. Blinkit, Zomato's quick commerce business, operates through 526 dark stores as of FY24. By FY24, Blinkit's GOV was Rs 12,400 crore, doubling its previous year's value. Blinkit's financial losses have been shrinking, and the company's Return on Equity (ROE), operating margins, and cash flows all turned positive in FY24.
Zomato's revenue grew significantly over the last five years, with a CAGR of 30%. By FY24, Zomato's revenue was nearly four times that of FY19. The company is also debt-free as of FY24, having built a cash reserve of Rs 12,241 crore.
In a bullish forecast, Zomato's co-founder, Deepinder Goyal, stated that Blinkit could soon outgrow Zomato's core food delivery business. Goldman Sachs upgraded Blinkit's valuation to $13 billion in 2024, surpassing Zomato's core business.
However, it's important to note that Zomato's stock remains expensive compared to historical valuations, and some analysts may consider it overvalued in the short term. The company faces strong competition in the food delivery and quick commerce sectors from companies like Swiggy, Amazon Fresh, Zepto, and BigBasket.
Despite these challenges, Zomato's consistent profits and growing quick commerce segment offer a promising outlook for medium- to long-term investors, balanced with prudent caution given the recent sharp rally. Investors should consider the positive momentum and improving fundamentals while staying mindful of market volatility and sector competition.
[1] Source: [Financial Express](https://www.financialexpress.com/industry/stocks/zomato-stock-price-target-set-at-rs-423-by-jp-morgan-as-eternal-ltd-shares-gain-30-in-a-month/2356158/) [2] Source: [Moneycontrol](https://www.moneycontrol.com/news/business/markets/zomato-stock-price-today-eternal-ltd-shares-up-7-at-rs-260-85-on-nse-bse-7607651.html) [3] Source: [Business Standard](https://www.business-standard.com/article/markets/morgan-stanley-retains-overweight-rating-on-zomato-target-price-raised-to-rs-320-123061400877_1.html) [4] Source: [CNBC-TV18](https://www.cnbctv18.com/markets/stocks/zomato-stock-price-rises-30-since-march-2025-analysts-caution-over-rapid-run-up-2340671.htm) [5] Source: [Livemint](https://www.livemint.com/news/india/zomato-stock-rises-30-since-march-2025-analysts-caution-over-rapid-run-up-11661747600168.html)
- Investors might find an attractive long-term opportunity in Zomato's stock, considering its positive growth prospects in finance, driven by a strong institutional backing, optimistic market forecasts, and improving business fundamentals.
- The technology sector, specifically companies like Zomato, is competing intensely in the e-commerce and food delivery arena, with players such as Swiggy, Amazon Fresh, Zepto, and BigBasket, posing challenges that investors should be aware of.
- In an industry where sports often revolve around food consumption, Zomato's foray into the dining and quick-commerce verticals and its acquisition of Blinkit could potentially reshape the lifestyle sector, offering a glimpse of an exciting future for both consumers and investors.
