Zomato Share Price Forecast: Strong Fundamentals to Extend Growth Path

Summary:
• Zomato share price has risen by more than 120 percent this year, but there are multiple reasons to expect more gains.

Zomato share price inched up on Thursday, building on Wednesday’s momentum to go up by 0.3 percent and trade at Rs 277.15 at the time of writing. However, the stock is still in the red on the weekly chart, with its losses in the last five trading sessions adding up to 3 percent. Nonetheless, Zomato (NSE: ZOMATO) is still among the best-performing at the BSE, with 122 percent in year-to-date gains.

Strong fundamental mean more headroom for Zomato share price

The sentiment surrounding Zomato share price is positive, based on a strong fundamentals. The food delivery company beat analysts forecasts for the quarter ending June, reporting an EPS of 0.28 versus the forecast 0.251. In addition, it acquired Paytm’s event ticketing and movies b$244 million in August, enabling it to take on BookMyShow.

Also, the quick commerce segment is one of the most promising growth frontiers, and Zomato’s infusion of Rs 300 crore into Blinkit in June attests to that. Acquired in 2022, Blinkit has become central to Zomato, with Goldman Sachs estimating that it has since outpaced the food delivery subsidiary.

According to a Goldman Sachs report released in April 2024, Blinkit had an implied value of Rs 119 per share versus the food delivery business’ value of 98. Furthermore, its CAGR is estimated to grow at 53 percent versus the Indian online grocery market’s projected CAGR of 38 percent between 2024 and 2027. Goldman Sachs also raised Blinkit’s valuation substantially, from $2 billion in March 2023 to $13 billion in April 2024.

Zomato share price prediction

The Money Flow Index (MFI) indicators shows that the momentum on Zomato favours control by the buyers. The pivot point will likely be at 274.25, and the first barrier could be encountered at 280.10. Further control by the buyers at that point will enable a break above that mark and potentialy test 285.60.

On the other hand, the sellers will likely take control if the share price breaks below 274.25. In that case, the first support could come at 269.90. If the selling momentum strengthens, the support could be breached, with the resulting momentum invalidating the upside narrative. Furthermore, it could extend losses to test 265.40.