Zomato Limited was up 1.12 percent in the morning trade on July 24 after the food delivery platform said that it had begun the process to liquidate its Portugal-based wholly-owned subsidiary.
Zomato Media Portugal was not a material subsidiary and its liquidation would not affect the turnover or revenue of Zomato Limited, the food aggregator said in an after-market-hour filing on July 21. The company did not specify the reason for liquidation of the subsidiary, which does not have active business operations.
At 10.02 am, Zomato was trading at Rs 81.60 on the National Stock Exchange, up 1.62 percent from the previous close. The share has gained 33 percent this year, so far.
Since January 1, Zomato has initiated liquidation proceedings for five subsidiaries and de-registered one. The subsidiaries were based in Indonesia, New Zealand, Australia, Jordan, and Portugal. It has maintained that the liquidation will not affect revenues or turnover of Zomato Limited.
Also read: Why Zomato continues to eat into Swiggy’s market share
Brokerage Motilal Oswal has a “buy” rating on the stock with a target price of Rs 80. The domestic brokerage firm sees a 24 percent upside in the stock.
“With dominant market share and strong growth in the food delivery business and Hyperpure, we expect Zomato to report a strong 36 percent revenue CAGR over FY23-25,” said Motilal Oswal in a May 22 report.
Hyperpure is business o business platform for kitchen supplies to hotels, restaurants and caterers.
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Zomato’s revenue for FY23 increased 65 percent to Rs 7760 crore. The food aggregator’s net loss narrowed 19 percent to Rs 971 crore in FY23 from the previous year. Earnings Before Income Tax Depreciation and Amortisation fell 2212 basis points to 6.81 percent in the same period.
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