Zomato shares off day's low as strike-hit Blinkit stores resume operations

Shares of Zomato Limited – a food delivery platform – recovered from day’s low to trade flat during Thursday’s trading session on the exchanges, after the company said in a statement that most strike-hit stores of Blinkit – a subsidiary company – has resumed operations.

Minutes after market opening today, the stock of Zomato was down nearly 1 per cent, however, it recovered to trade off lows as the day progressed and was quoted at Rs 54.08 per share, down 0.06 or 0.11 per cent from the previous day’s closing of Rs 54.14 apiece on the BSE.

Zomato in its regulatory filing on Wednesday said, “Most of the stores of quick commerce player Blinkit have resumed operations after being affected by strike of delivery partners.”

A quick-commerce delivery platform Blinkit, formerly known as Grofers India, was acquired by Zomato last year. Recently the operations of the platform were affected by the strike of delivery partners who were protesting due to the reduction in payouts per order.

"We had to shut down some stores for a few days to ensure the safety of our employees at stores and the delivery partners. Most of these stores have now resumed operations," Zomato mentioned in its exchange filing on April 19.

The company’s clarification on the financial impact of the situation at Blinkit, Zomato shares soared around 5 per cent during Wednesday’s trading session.

"These disruptions and changes have no material impact on the operations/financial performance of the company (meaningfully less than 1 per cent revenue impact),” the company had said.

Earlier on Wednesday, global brokerage firm UBS maintained a ‘buy’ call on Zomato with a reduced target of Rs 80 apiece from Rs 90 a share earlier.

The brokerage cut FY24-25e food delivery GOV (gross order value) for Zomato by 10 per cent although revenue estimates are down less due to better take rates and hyper-pure revenues.

Zomato shares in the last one year have dipped nearly 33 per cent as compared to over 2.5 per cent rise in the Nifty50. Year-to-date, the has declined by over 10 per cent against 3 per cent fall in the benchmark index.

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