Zomato's share price has seen significant growth, gaining nearly 5% over two consecutive trading sessions. The stock opened at ₹274.50 on the BSE on Tuesday, slightly above its previous close of ₹273.60.
It later climbed to intraday highs of ₹278.60, reflecting a 2% increase within the day. This upward trajectory underscores Zomato's growing appeal in the realm of share market investment, further boosting investor confidence.
Why is Zomato's share price rising?
Several key developments have fueled this rally. One major factor is Zomato's inclusion in the prestigious 30-stock Sensex index. Companies are added to the Sensex based on a rigorous selection process involving their average six-month float-adjusted market capitalisation. The addition of Zomato to this index, set to take effect from December 23, 2024, signals heightened market confidence in the company's performance.
Additionally, Zomato’s approval of an ₹8,500 crore Qualified Institutional Placement (QIP) has further bolstered its position in the share market. This move includes setting a floor price of ₹265.91 per equity share, indicating strategic fundraising efforts aimed at future growth. These positive developments have made Zomato a noteworthy player for those exploring share market investment opportunities.
Analysts optimistic outlook
Market analysts remain bullish about Zomato’s potential, especially following its strong Q2 performance. Analysts project accelerated growth in the second half of the fiscal year, driven by festive demand and robust operational metrics.
Predictions for improved EBITDA margins and consistent growth in gross order value reinforce Zomato's appeal as a promising pick for share market investment enthusiasts.
Technical analysis points to a bullish breakout
From a technical perspective, Zomato's stock exhibits a compelling setup for further gains. Weekly charts indicate a bullish flat base pattern, which has been forming over the past 17 weeks. This pattern suggests a consolidation phase that could pave the way for a significant breakout in the weeks ahead.
A decisive move above the ₹300 resistance level could propel the stock toward the ₹450 mark, making it a potential game-changer for long-term investors. Analysts believe this momentum positions Zomato as a strong candidate for growth-oriented share market investment strategies.
What this means for investors
Zomato’s recent performance, coupled with its strategic developments and positive technical indicators, presents a compelling case for both short-term traders and long-term investors. As the company continues to strengthen its market presence and capitalise on growth opportunities, its stock remains an attractive option for those keen on share market investment.
By keeping an eye on Zomato’s progress, investors can make informed decisions and potentially benefit from its upward trajectory in the dynamic share market landscape.
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