Zomato surges 72% this year, nears 52-week high on ICC World Cup booster

The 1-year Beta of Zomato stands at 1.61, implying very high volatility in share price.

The share price of Zomato jumped around 2.5 percent on Tuesday to an intraday high of Rs 104.30 on the NSE amid positive outlook on account of the ICC Men's World Cup 2023. The stock has rallied over 70 percent so far this year, and is just shy of its 52-week high of Rs 105.

Zomato could be the biggest beneficiary of the World Cup in the post-Covid era, said Karan Taurani, Senior Vice President - Research Analyst at Elara Capital, said in an interview with CNBC-TV18.

“If you look at the market share numbers over the last 3-4 years, pizza has lost market share as a category within the overall QSR chain. It's a win-win for burger, fried chicken for aggregators like Zomato, over the near to medium-term,” Elara Capital's research analyst said.

Also Read| Indian Hotels, IndiGo, Varun Beverages among stocks that may benefit from Cricket World Cup

ICC World Cup boost 

According to Taurani, during World Cup 2011 and 2019, Jubilant FoodWorks, operator of Domino's Pizza in India, would have been the biggest beneficiary because of its best user experience in terms of delivery. This time, however, he believes  that Zomato could be the one. “We have seen adoption wherein delivery of food has moved to other categories and not just pizza. Zomato is able to replicate or even do better as compared to Jubilant in terms of the overall delivery experience.”

Increased orders and restaurant partnerships

According to brokerage firm Motilal Oswal, Zomato, as an online food delivery platform, may experience increased orders and restaurant partnerships during the ICC World Cup, especially for home-viewing parties. They can leverage marketing campaigns and special offers to attract more users.

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Zomato Technicals

The Zomato stock has soared around 67 percent in the past one year. Technicals show that the relative strength index (RSI) of the stock stands at 61.3, implying that it's trading neither in the overbought nor in the oversold territory.

The one-year Beta of Zomato stands at 1.61, implying very high volatility. The stock is trading above its 5-day, 10-day, 20-day, 50-day, 100-day and 200-day moving averages, according to Trendlyne data.

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