Zomato’s stock has posted a 30.31% return over the past year but fell over 6% in the last month, declining 5.4% to INR 199.75 during trading on March 11. The company, with a market capitalization of INR 1.94 Lakh Cr and over 6.6 Cr shares traded by noon, has been under pressure amid a broader market downturn. Shareholders approved a name change to Eternal Limited, reflecting Zomato’s expansion beyond food delivery, particularly with its Blinkit acquisition. Despite increased competition in quick commerce, brokerage ICICI Securities remains optimistic about Zomato and Swiggy, viewing cash burn concerns as exaggerated.
Despite achieving a return of 30.31% in the previous year, the stock has dropped more than 6% in the last month, reflecting a downturn in the broader market.
Zomato’s market capitalization was recorded at INR 1.94 Lakh Cr, with over 6.6 Cr shares traded by 12:30 PM.
On Monday, Zomato announced that it has obtained shareholder approval to change its name to Eternal Limited.
Shares of the foodtech giant Zomato declined by 5.4%, reaching INR 199.75 during intraday trading on the BSE on Tuesday (March 11).
The stock saw a slight recovery afterward, trading 4.8% lower at 12:30 PM compared to its previous close of INR 211.20 on the BSE. The company’s market cap remained at INR 1.94 Lakh Cr, with over 6.6 Cr shares having changed hands by that time.
In the face of a broader market downturn, Zomato’s shares have been under pressure for several months. While the stock has appreciated by 30.31% over the past year, it has suffered a decline of over 6% in the last month.
If the stock continues to lose ground until the market closes, it will mark the fifth consecutive session of decline.
On Monday, Zomato revealed that it received approval from its shareholders for the name change to Eternal Limited. The shareholders passed a special resolution to approve the name change and the necessary amendments to the Memorandum of Association and Articles of Association of the company.
In justifying the name change, cofounder and CEO Deepinder Goyal mentioned last month that Zomato began using ‘Eternal’ internally post-acquisition of Blinkit, to create a distinction between its corporate identity and its food delivery service.
“We believed that we would officially rename the company to Eternal when something beyond Zomato became a significant future driver. With Blinkit, I feel we have reached that point. Thus, we would like to rename Zomato Ltd., the company (not the brand/app), to Eternal Ltd,” Goyal added.
Amid the growing popularity of quick commerce platforms, Blinkit has experienced remarkable growth in the last year. However, competition is intensifying in the segment, primarily dominated by Blinkit, Zepto, and Swiggy Instamart, with new entrants like Amazon and Flipkart Minutes emerging recently.
This competitive landscape has impacted Zomato’s stock, particularly as Blinkit’s adjusted EBITDA loss surged 13X to INR 103 Cr in Q3 FY25 from INR 8 Cr in the previous September quarter.
Nevertheless, brokerage ICICI Securities recently expressed optimism about Zomato and its competitor Swiggy. The firm noted that concerns regarding the quick commerce sectors’ cash burn are overstated.
In the meantime, shares of rival Swiggy were trading 2.14% lower at INR 352.05 as of 12:40 PM on the BSE.
Zomato concluded the trading session on Tuesday (March 11) at INR 208, down 1.52% on the BSE.