Alibaba Group Arm Antfin Singapore Holding To Offload 1.54% Stake In Zomato

Alibaba Group's arm Antfin Singapore Holding is planning to offload 1.54 stake in leading online food delivery giant Zomato via block deals in order to raise approximately $408 million, highlighted the CNBC-TV 18 report today.

The floor price for the block deals has been set at Rs 251.68 that is 4.05% discount to Zomato's closing price of Rs 262.30 on Bombay Stock Exchange (BSE), added the CNBC-TV 18 report.

Antfin's stake in Zomato stood at 4.3% or 37,38,55,225 shares of the company as of June 30, 2024, accoding to BSE.

Last trading price of Zomato shares on NSE is Rs 263.24 per share with decline of 1.19% in trade today.

The 52-week high price of Zomato share on BSE is Rs 280.00 (as on 19/08/2024) and 52-week low price is Rs 88.16 per share (as on 21/08/2023), respectively. Zomato has a market capitalisation of Rs 2,31,624.08 crore.

Zomato shares gave return of 20% in last 1-month, soared 110% year-to-date, offered return of 193% in last 1-year, and gained 327% in last 2-years. In last 3-years, Zomato stock surged 94%.

Goldman Sachs and Morgan Stanley are the placement agents of the deal, according to a Bloomberg report.

If the recent transaction takes place, Antfin Singapore's shareholding will come down to 2.76% from present 4.3% stake in Zomato as of June 2024.

Zomato Ltd. announced a massive jump in its net profit to Rs 253 crore for June 2024 quarter as against Rs 2 crore net profit declared in the corresponding quarter of last year.

Zomato's revenue surged approximately 74% year-on-year (YoY) for the June quarter to Rs 4,206 crore as compared to Rs 1,416 crore in the corresponding quarter of last year.

EBITDA for the quarter under consideration stood at Rs 177 crore as against the loss of Rs 48 crore during the similar quarter of last year.

Should you buy Zomato share? Two leading brokerage firms have recommended buy call and overweight rating to Zomato share. Foreign brokerage UBS recommended buy rating to Zomato with an upgraded target price of Rs 320 against Rs 260 earlier. Previously, Morgan Stanley gave overweight rating to Zomato with the target price of Rs 278.

"We have also increased employee cost estimates to reflect investments in manpower. These changes, coupled with roll forward of our valuations and higher multiples for Ging Out and Hyperpure, lead to higher PT of Rs 320," UBS said.

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