Zomato Shares Plunge to 6-Month Low Amid Blinkit Expansion Plans

The online food delivery giant’s stock plunged to its lowest level since July 23, 2024, witnessing a sharp decline of 13.33%, bringing the price down to Rs 207.80 per share.

Zomato Shares Hit 6-Month Low Following Weak Q3 FY25 Earnings Amid Blinkit Expansion

Mumbai: Zomato’s share price tumbled to a six-month low on Tuesday after the company's Q3 FY25 earnings report revealed a significant decline in profits. The stock fell 13.33% to Rs 207.80 per share, marking its lowest level since July 23, 2024

As of 12:52 p.m.,Zomato’s shares were trading 8.88% lower at Rs 218.40, even as the broader Nifty 50 index recorded a modest 0.31% gain. Analysts attribute the decline to the company's aggressive investment in its quick-commerce arm, Blinkit, which has put pressure on profitability in both the current and upcoming fiscal years.

Zomato’s third-quarter results for December 2024 highlighted the impact of Blinkit’s rapid expansion, with the company’s **net profit plunging 57% year-on-year to Rs 59 crore, compared to Rs 176 crore in the same period last year. However, operational revenue saw a 64% surge, reaching Rs 5,404 crore, up from Rs 3,288 crore in Q3 FY24.

Founder and CEO Deepinder Goyal acknowledged that the company’s losses in quick commerce were due to accelerated growth investments that were originally planned to be phased over the coming quarters. He further stated that Zomato is set to achieve its target of 2,000 Blinkit stores by December 2025, a year ahead of the previous projection.

Despite the current financial strain, Zomato remains focused on expanding Blinkit’s footprint, aiming for long-term market dominance in the quick-commerce segment.