Zomato shares rally 4% even as JM Financial trims food delivery biz growth estimates for FY23-27

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Fintech giant Zomato traded on a bullish note on Monday despite a brokerage trimming its growth estimates for the company's food delivery segment over FY23-27 financial years..

In its latest research note, JM Financial said, "Our recent channel checks suggest sequential food delivery GOV growth is likely to remain muted for the third consecutive time in Mar-Q.".

Thereby, the brokerage said, "While we now forecast Zomatos food delivery segment to grow at a CAGR of c.21% over FY23-27 vs. the earlier estimate of ~25%, contribution margin (as % of GOV) could reach ~7% by FY27 versus FY34 expected earlier."..

However, despite lowering food delivery growth estimates in Zomato, JM Financial believes that the company remains a long-term story..

It added, "We continue to remain bullish on the companys long-term prospects in the hyperlocal delivery space as we believe it is well positioned to benefit from robust industry tailwinds such as improving tech penetration and rising income share of digitally native millennials / GenZ..

Full story at mint | 

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