Jobaaj Stories
After its IPO's major success in June 2021, the share price of food delivery platform Zomato has kept falling down. Today morning (24th January,2022), it has slipped below the Rs 100 line by falling more than 10% in the morning trade.
The Zomato session has seen 5 consecutive loss sessions thereby falling an overall of 25% during the period, wiping out 25% of investor's wealth.
The Share has hit its 52 weeks low at Rs 91.6,and is currently(IST 12:00:00) trading at Rs 92.6.
The major cause of this seems to be the recent reports suggesting that Federal Reserve rolling back liquidity amid higher inflation and indicating multiple interest rate hikes this year have weakened the case for investment in richly priced technology stocks with no near-term visibility on profitability.
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The impact of this cause can also be clearly seen on other similar company shares such as One97, the parent company of paytm and FSN E-commerce ventures, the parent company of Nykaa.
One97 and FSN-E have also recorded their 52 weeks low of Rs 902.3, and Rs 1740, respectively.
The bearish impact on these technology-dependent stocks is also felt by many of the US companies
Another reason for the share price fall might be investors' sentiments dampening after recent reports suggested that the government was planning a wage code bill, which, if implemented, analysts said, would drastically alter the way industrial houses treat their employees and also impact the working hours, take-home salaries, and other rights of employees.
Experts also suggest that this bearish behaviour might be taking the Zomato share to a more justified valuation as many believed that the share was listed at an inflated valuation.
Is This The Time To Invest In The Zomato Share?
Experts suggest that this downfall was long inevitable, as the many new edge IPOs were evaluated at very inflated prices due to the market euphoria at the time.
However, Zomato does seem to have the potential of administering gradual growth in its price from here on out.
The recent government regulations might hinder the growth for the nearby time but aggressive investors can surely use this downfall as a buying opportunity with a long-term holding view.
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