HSBC Securities should have had a better understanding of Info Edge and Zomato, says Chintan Thakkar, CFO of Info Edge.
HSBC Securities marked down Zomato Media's valuation by nearly half today, making the restaurant search firm get back.
Strongly disagreeing with the HSBC report, Chintan Thakkar, CFO of Info Edge, a major investor in the search firm, said: "We don’t agree with the report. We think there should have been a better understanding of Info Edge and Zomato."
Even as HSBC analysts on Zomato were concerned about its food delivery business, Thakkar said the search firm's main business model is classifieds, and not food delivery.
Regarding Zomato's foreign push, Thakkar said in an interview with CNBC-TV18, it takes time for the business to grow. Listing of restaurants will take time and traffic will be slow in coming, he said.
Out of 23 countries, in 18 countries, Zomato is a traffic leader. It will take some time for the company to start monetising its overseas business, he said.
"In seven to eight countries, it has started to break even."
As regards the layoffs that happened at Zomato recently, Thakkar said there is bound to be 'right-sizing' when a company is trying to get its act together
"We think Zomato is on the right track."Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.