New-Age Tech Stocks | Policybazaar crashes 15%, CE Info Systems logs biggest weekly gain; Nykaa reduced to ‘sell’

New-age tech stocks such as Paytm, CE Info Systems, Ola Electric, among others, witnessed rapid changes in their respective stock prices in the last five days when domestic equity benchmarks Sensex and Nifty 50 picked an invincible rally and logged unbeatable record highs on strong global cues. This week, most new-age tech stocks registered losses and settled in red, while only a few outperformed the frontline benchmarks on robust buying interest.

Among the biggest trend makers, India's largest online insurance and lending platform, PB Fintech, which operates Policybazaar, snapped its earlier winning streak and emerged as the biggest loser in the pack. CE Info Systems gained four per cent and outperformed PB Fintech and other major new-age stocks. PB Fintech had earlier overpowered CarTrade Tech to log the biggest weekly gain.

Also Read: ICICI Securities sees 42% upside in Delhivery, recommends ‘buy’—key reasons why

New-age tech stocks: Weekly price trend

D-Street experts said new age-tech stocks like Zomato, Delhivery, Nykaa, Paytm, Unicommerce, FirstCry, and Ola Electric outperformed the Nifty 50 index, however, Paytm and Nykaa generated positive returns during the week.

CE Info Systems and One97 Communications, the parent company of fintech giant Paytm, were the only stocks which dominated the new-age tech pack last week logging an increase of four per cent and 1.32 per cent in their stock prices respectively. Deepinder Goyal-led food delivery giant Zomato is the biggest new-age gen stock by market value with a market capitalisation (mcap) of ₹2,45,816.49 crore.

Also Read: Multibagger PB Fintech share price declines up to 6%: Should you Buy, Sell or Hold the Policy Bazaar stock?

On the other hand, Policybazaar was the biggest trend changer, shedding as much as 15.30 per cent from its stock price and emerging as the biggest loser, dropping from the number one rank in the earlier week. This was followed by Ola Electric, which crashed 7.93 per cent, and Honasa Consumer (Mamaearth), which fell 4.60 per cent in the last five days. CarTrade Tech commands the smallest mcap at ₹4,625.71 crore among the top 13 new-age tech stocks.
 

New-age tech stocks outlook

1.Zomato - Target Price ₹315

Blinkit’s rapid expansion to new cities is a strategy to gain first-time users and better utilize its mother warehouses. Several new initiatives are underway to increase customer wallet share: (1) pilot for product returns, especially for branded apparel; (2) larger dark stores and split shipments; and (3) new category addition. 

“Competitive intensity is high, with potential price competition in select cities. We upgrade FY2024-27E Blinkit GMV CAGR to 81 per cent and maintain BUY with a revised SoTP-based FV of ₹315 ( ₹270 earlier),” said Shrikant Chouhan, Head Equity Research, Kotak Securities.

Also Read: Paytm share price crosses ₹700 mark for first time since January, up 116% from May lows
 

2.FSN E-Commerce Ventures (Nykaa) - Target Price ₹190

FSN E-Commerce Ventures (Nykaa) has a diverse portfolio of beauty, personal care, and fashion products, including owned brand products manufactured by it. As a percentage of NSV, Kotak Securities belives the fulfilment cost may increase soon as the company attempts to cover many cities in the same-day/next-day delivery folds. 

“Consequently, we trim EBITDA estimates for our BPC and eB2B segments, resulting in a 7-11 per cent EPS cut for FY2025-27 and a new FV of ₹190. The sharp 34 per cent run-up in stock price in the past three months drives a downgrade in the rating from ADD to SELL,” said Chouhan.
 

4.Delhivery - Target Price ₹560

Delhivery provides a full range of Logistics services, including delivery of express parcels and heavy goods, PTL freight, TL freight, warehousing, supply chain solutions, cross-border Express, freight services, and supply chain software. The 1Q beat helps allay Valmo's effect on revenue growth and profitability. 

Also Read: Zomato share price up 369% in 2 years. Should you buy more or book profit? Here’s what experts say

The growing reach and interplay of Delhivery’s businesses are helping it leverage its integrated and interoperable network, increasing its cost lead over its new-age/traditional monoline business peers. It is rightfully skipping new opportunities that limit the use of such network moats. 

“This should likely set the stage for positive surprises on margin uptick. We increase our margin estimates by 60-100 bps (versus ~100 bps 1Q beat); FV increases to ₹560 from ₹545,” said Kotak Securities. The brokerage gave a BUY rating on the logistics stock.
 

4.One97 Communications Ltd (Paytm)

Paytm share price has recently gained momentum and the stock has risen over 19 per cent in one month. Paytm shares have jumped more than 61 per cent in three months, while its year-to-date (YTD) returns stand at just over four per cent.

Also Read: Zomato co-founder & CPO Akriti Chopra resigns

Emkay Global Financial Services upgraded its rating on the stock to ‘Add’ from ‘Reduce’ while raising its DCF-based target price by 100 per cent to ₹750 per share from ₹375 earlier. Paytm's target implies an upside of over 15 per cent from its current price. The domestic brokerage cited easing regulatory pressures and the company's effective cost optimization strategies for its positive outlook.

“Easing regulatory stance shall pave the way for approvals from the NPCI and RBI to onboard new users / online merchants, which should drive the business turnaround. This, coupled with its cost optimization measures, should put Paytm on the early path to profitability,” said Anand Dama, Senior Research Analyst at Emkay Global Financial Services.
 

5.Honasa Consumer Ltd

Honasa Consumer is undertaking several initiatives to identify focus categories and will likely leverage its house of brands to create wider portfolio offerings in focus categories and their sub-segments. Apart from this, Honasa is also undertaking a phase-wise restructuring of the offline channel (enhancing the direct reach and right-sizing inventory levels), which should improve the channel's effectiveness and help fortify its position in core categories. 

Also Read: Paytm on track of profitability, says Emkay Global; upgrades stock to ‘Add’, hikes target price by 100%

“We expect inventory right-sizing to impact sales (especially Mamaearth) and profitability in Q2, after which recovery to normalised levels should follow from Q3FY25E. We believe the initiatives around portfolio and distribution channels are steps in the right direction, which should enable high single-digit sales CAGR for Mamaearth over the next three years,” said domestic brokerage JM Financial Institutional Securities.

“Execution on newer brands (led by The Derma Co (TDC)) has been better than expected, with enough headroom to scale up sales and profitability. We believe near-term challenges are more transient in nature. Corrective initiatives undertaken will sharpen overall execution. Sharp dips should be used as an opportunity to add,” added JM Financials.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.