If you missed the impressive rally in Zomato’s stock, don’t worry—there’s another stock that’s benefiting immensely from Zomato’s success. Info Edge (India) Ltd. has seen its shares surge over 5.5% recently, reaching a fresh 52-week high of Rs 7,327.75 on the NSE. With the stock nearing its record high of Rs 7,465, which was last hit on October 31, 2021, investors are taking notice. Here’s why Info Edge is riding high on Zomato’s wave.
Info Edge continues to hold a significant stake in Zomato, the popular food delivery aggregator. As of the end of the June quarter, Info Edge’s stake in Zomato stood at 13.53%. This stake has proven to be a goldmine for Info Edge, especially with Zomato’s recent performance. On Friday, shares of Zomato surged as much as 19% following its stellar earnings report.
Zomato reported a multifold increase in its net profit, soaring to Rs 253 crore in Q1FY25, up a staggering 12,550% year-on-year from Rs 2 crore in Q1FY24. This dramatic rise in profitability was driven by a hike in platform fees charged to consumers and improved operational profitability from its quick commerce arm, Blinkit. Additionally, Zomato’s food delivery gross order value (GOV) increased by 27% to Rs 9,264 crore, while quick commerce GOV saw a 130% rise to Rs 4,923 crore compared to the same period last year.
With Zomato’s shares hitting a high, Info Edge’s stake in the company was valued at over Rs 30,000 crore at its peak. This valuation has contributed significantly to Info Edge’s market capitalisation, pushing it back towards the ₹1 lakh crore mark. As of now, Info Edge’s market cap stands close to Rs 94,000 crore.
The recent surge in Info Edge’s stock has extended its gains for 2024 past 40%. Over the last 12 months, the stock has appreciated by nearly 60%.
Conclusion
If you missed out on Zomato’s rally, investing in Info Edge could be a compelling alternative. With its substantial stake in Zomato and impressive market performance, Info Edge is poised to continue benefiting from the food aggregator’s success. Keep an eye on this stock as it nears its record high level.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
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