Zomato shares saw a jump after the firm turned profitable in Q1 FY24. Zomato reported a consolidated net profit of Rs 2 crore for the quarter ended June 2023 against a loss of Rs 186 crore in the corresponding quarter of the last financial year. The company also reported a loss of Rs 189 crore in the quarter ended March.
Meanwhile, the revenue from operations for the reporting quarter stood at Rs 2,416 crore, which was up nearly 71% YoY against Rs 1,414 crore reported by the company in the year-ago period.
Gaurav Bissa, VP at InCred Equities, said, “Zomato has seen a very strong upmove from 58 levels when it triggered a buy signal in the Ichimoku setup. The stock has been forming higher highs and higher lows on the daily charts since Jan 2023 implying short-term trend reversal.”
“Investors are advised to buy the stock on declines towards 80 for a target price of 120-140 whereas existing shareholders can use 75 as trailing stop-loss,” Bissa said.
Meanwhile, Pravesh Gour, Senior Technical Analyst at Swastika Investmart, said, “The counter is bottoming out and has also witnessed a breakout of an inverse head and shoulders formation pattern on the weekly chart. It has confirmed its breakout above Rs 90. The overall structure also looks lucrative for long-term investors as it trades above all-important moving averages.”
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“MACD supports the current strength, whereas the momentum indicator RSI is also positively poised. On the upside, Rs 100 is the psychological resistance level; above this, we can expect a rally towards Rs 114. On the downside, Rs 87 is an important support level during any correction,” Pravesh said.Commenting on the Q1 earnings and his address to the investors, Managing Director and CEO Deepinder Goyal said, “We have been working hard to make our business less complex, and putting the right people at the right spots within our businesses. These things do not have definite/measurable impact, and I can in hindsight say that most of our seemingly “risky” bets have changed the trajectory of the business significantly, much faster than we expected”.
On the issue of profitability, Akshant Goyal, Chief Financial Officer said that he expected the business to remain profitable going forward. “Knowing what we know today, we believe we will continue to deliver 40%+ YoY topline (Adjusted Revenue) growth for at least the next couple of years,” Goyal said.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)