Moore has sold its stakes in Zomato for INR 187 Cr following the purchase of the holdings in the month of January 2021 for INR 191 Cr
The shares fell to a record lowest at INR 40.55 in the early hours of the afternoon of Wednesday (July 27, 2007) in accordance with BSE data.
Following the news of Blinkit’s acquisition Blinkit acquisition on the 25th of June, the share price of Zomato has dropped by nearly 37%.
Based on block sale information Venture capital company Moore Strategic Ventures has sold its entire Zomato holding which is 4.25 Cr shares for INR 44 per share.
Moore had sold its shares in Zomato for INR 187 crores. The VC firm bought Zomato’s holdings with the help of compulsorily convertible Series G shares from Nexus Ventures in January 2021 for INR 191 crore. Thus, Moore ended up booking an loss of INR 4 crore from its stake in Zomato.
The move comes in the midst of an unfavorable few days for the foodtech company that is listed that is listed on the markets. The shares traded at INR 41.60 each today (July 26). Zomato’s shares have dropped by more than 18% in the last five days.
The company’s shares fell to a record low of 40.55 the previous Wednesday (July 27) according to BSE information and then rebounded to 43.09 each around 11 AM.
The foodtech company was under intense pressure to sell its shares towards the end of last week, as the lock-in period for internal investors expired on the 23rd of July 2022. This was a year after that the company’s shares were traded on the exchanges at over a huge price.
Moore was the first insider investor to exit Zomato but, as of Monday, the shares of Zomato are in freefall.
However the broker firm Jefferies has maintained the trust in Zomato by reserving its “buy” rating as well as an estimated price-target (PT) in the range of INR 100 for Zomato’s stock. Jefferies declared that the food technology startup makes a compelling case for investors who are looking to invest long-term today.
Zomato’s investors’ mood has been down since the $570 million acquisition of the quick business startup Blinkit during June. The supposed delay in the disclosure of the acquisition further upset the investors many of them sent letters to SEBI about the similar.
After the release of the Blinkit deal on the 25th of June Zomato’s share price dropped by nearly 37%..
The foodtech startup clocked a reduction that was INR 359.7 Cr for the quarter ending March 20, 2022. This is an increase of 168% over INR 134.2 Cr recorded in the preceding quarter. With the acquisition of Blinkit another loss-making startup, concerns regarding the possibility in the merger have led to a massive selling pressure. Blinkit owns a loss of INR an average of 84 per purchase.
It is interesting to note that some analysts have called the sale a short-term consequence on the Blinkit deal and Zomato probably increasing its revenue through a brand newly launched Zomato Pro subscription. But, it’s an open-ended game to see how Zomato will navigate the mess it’s before it.