Food delivery aggregator Zomato made a memorable debut in the stock market on Friday (July 23) as its share prices soared 51.3 per cent.
The stock’s issue price was ₹76 when it opened at the Bombay Stock Exchange (BSE) at ₹115. By the time the closing bell rang, the share price of the food delivery platform stood at ₹126. Zomato shares hit 20 per cent upper circuit at ₹138, nearly doubling IPO investors’ money, before settling at ₹126 at the end of the day’s trading. The company’s stellar performance helped its valuation at the BSE cross the ₹1-lakh-crore mark briefly and settle on ₹98,211 crore on the closing bell.
At the NSE, the Zomato share got listed at ₹116, registering a premium of 52.63 per cent.
WATCH: Zomato IPO Is Working On A Bigger Fool Theory, Analyst Cautions Investors
“Despite the large size of IPO at ₹9,375 crore and rich valuations, the company saw a healthy overall subscription of 38 times. There is a lot of fancy for such unique and first-of-its-kind listing in the market. Zomato with first-mover advantage is placed in a sweet spot as the online food delivery market is at the cusp of evolution,” Sneha Poddar, Research Analyst, Broking & Distribution, Motilal Oswal Financial Services Ltd, told news agency PTI.
Zomato’s IPO was India’s biggest initial share sale offer since March 2020. The IPO had opened for subscription on July 14, in a price band of ₹72-76 per share. It closed on July 16. The company, backed by Jack Ma’s Ant Group Co, is the first from a long list of Indian unicorn startups to launch an IPO. It is also the first among Indian online food aggregators.
Zomato has said it will utilise the IPO proceeds for funding organic and inorganic growth initiatives and general corporate purposes.
Zomato was launched in 2008 and today has a presence in 525 cities across the country and 23 countries outside India with 3,89,932 active restaurant listings.
(With inputs from Agencies)