Zomato sees Rs 5,438.50 crore block deal as Antfin Singapore likely sells stake

Just yesterday, UBS Securities turned out to be the second brokerage to raise its price target for Zomato to over Rs 300.

Food aggregator Zomato's shares worth Rs 5,438.50 crore were sold in a block deal on August 20 which was upsized later, with Antfin Singapore Holding, an subsidiary of the Alibaba Group, being the likely seller.

As much as 21 crore shares, representing a 2.4 percent stake in the online food delivery platform changed hands in the block deal. The transaction was executed at a floor price of Rs 258 apiece, implying a discount of nearly 2 percent over the stock's previous closing price.

Following the block deal, shares of Zomato witnessed a knee-jerk reaction and fell over 1 percent. At 09.21 am, the shares were trading at Rs 259.20 on the NSE.

While Moneycontrol could not immediately ascertain the parties involved in the transaction, CNBC-TV18 reported on August 19 that Antfin Singapore Holding was eyeing to unload a 2 percent stake in Zomato, pegging its valuation at $556 million (Rs 4,650 crore).

Earlier, it was reported that Antfin was planning to offload 1.54 percent shares worth $408 million.

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As per Zomato's latest shareholding data, Antfin Singapore Holding owned a 4.3 percent stake in the food delivery platform. The stake sale will also trigger a 90-day lock-in period before Antfin can execute another round of equity dilution.

The stake sale comes on the heels of Zomato's quarterly earnings where net profit surged 126.5 times to Rs 253 crore in the April-June quarter compared to the same period last year. The boost in profits was driven by increased platform fees charged to consumers and improved operational profitability in its quick commerce arm, Blinkit.

In addition, Zomato's quarterly performance and robust growth prospects in areas like quick commerce garnered bullish price targets and also lifted shares up around 20 percent in just the past month.

The stock has also been a multi-bagger, rewarding investors with returns of 112 percent year-to-date and nearly 200 percent in the past year. Some brokerages like CLSA and UBS Securities anticipate the stock to top the Rs 300-mark within the next 12 months, further boosting returns.

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