Swiggy, Zomato share prices decline up to 7% with the stock market crash: Do you own?

Stock Market Today: Swiggy Ltd, Zomato Ltd share prices saw sharp decline of more than 6% as the stock market crashed.

Share price movement

Swiggy Ltd share price opened at ₹444.50 on the BSe on Monday, almost 1% lower than previous closing price of ₹448.50. Swiggy Ltd share price thereafter corrected to ₹415.30, marking a decline of more than 7%.

The Swiggy share price has corrected more than 8% in last 5 days, with Volatility in the markets

Zomato Ltd share price had opened at ₹213.40 on the BSE on Monday, also around 1% lower compared to the previous closing price of ₹215.80. Zomato share price thereafter dipped to the intraday lows of ₹207.90, marking a decline of clos to 4%

Zomato share price also has declined up to 7% in last 5 days with volatility in the markets.

Analysts have maintained concerns on competition

The analysts view have been divided looking at rising competition in the space

For Zomato analysts at Macquarie in theor recent report had said that they regard Zomato as an efficient Q-Com and Food Delivery platform, but for the shares they see limited margin of safety. They see rising competition in Q-Com denting consensus forecasts.

Motilal Oswal Financial Services however had said that for Zomato, there is Short-term pain but there is long-term gain.

Jefferies India Pvt Ltd post Q3 results some days back said that Q3 for Zomato was mixed 3Q with, as expected, modest growth in food delivery but much better margin. However, QC reported strong growth but slipped into losses due to growth investments along with high competition. Management as per Jefferies aims to double store count to 2k by Dec-25, one year earlier than past guidance. While Blinkit has a strong execution track record, aggressive expansion may force competition to follow suit – with entry of new players further adding to competition. Jefferies maintained Hold ratings on Zomato with slightly lower price target of at Rs255.

Meanwhile on Swiggy too HSBC Global research had maintained caution due to completive intensity. They said that catching up on both growth and profitability could be challenging in light of the severe competitive intensity· They initiated coverage of Swiggy in December with a Hold rating and a target price of ₹550.

Disclaimer: The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.