Zomato share price: Experts see 45% upside in this Multibagger stock. Should you buy?

Zomato share price: With 118% returns year to date and more than 130% in last one year Zomato Stock has given Multibagger returns to investors. However experts see 45% upside in this Multibagger stock . Here is why?

Strong Q2 Results

Zomato has seen strong Q2 performance, Zomato Ltd's Q2FY25 net profit increased by 389% to ₹176 crore from ₹36 crore the previous year. Revenue increased by 68.5% to ₹4,799 crore. However, a decline in cash balance following the acquisition of Paytm's ticketing business caused a 30.43% dip in net profit from Q1FY25.

The B2C segment of Zomato saw strong gross order value (GOV) growth of 55% annually and 14% sequentially. Despite growing competition, the Blinkit company is still doing well; in Q2FY25, it saw a 20% sequential rise.

Analyst views Post Q2

Analysts at Axis Securities said that with a strong brand value and increasing demand for B2C business and quick commerce, they believe Zomato will demonstrate exponential growth from FY25 to FY26. Hence, they maintain their rating on the stock, raising their target price

The management remains confident about the medium-to-long-term outlook. Furthermore, it has indicated that FY25 is likely to be better than FY24.

Elara Securities India Pvt Ltd had said that they expect growth acceleration in H2, backed by the festive season. On the profitability front, they estimate EBITDA (as a percentage of GOV) to move to 4-5% in FY27, as guided. They increased their consolidated revenue and earnings estimates, factoring in higher revenues from the Going Out business led by the Paytm acquisition.

Technical views indicate good upside

“Zomato has exhibited a consistent upward move since June and made a high of 298 in September. A valid correction then followed with a lower top formation and then the stock made a low of 240 in November", said Bharat Gala, COO Equity broking- Ventura Securities. Its KST (price momentum indicator), Aroon chart indicator Up/Down and Demand Index indicators are positive, as per Gala. Recently, it also showed a symmetrical triangle breakout by a positive weekly price candle supported by volumes, he added. After trading around the moving average for a while, Zomato is now clearly trading above its moving average. The target is 400 with support levels of 260, 254, and 248, where more shares can be accumulated, said Gals. The stop loss would be 238 he added

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.