Zomato Share Price: Zomato shares fell 5% to ₹264.85 per share on the NSE after global brokerage firm Jefferies raised concerns over rising competition in the quick commerce space.
After Zomato’s shares more than doubled in value in 2024, analysts at Jefferies forecast that 2025 could be a breather year, with the stock possibly shifting gears into a price consolidation phase.
According to news reports, the brokerage said that aggressive strategies by existing players and entry of new competitors could lead to higher discounts, which could pose risks to Zomato’s medium-term profitability.
The brokerage said that apart from Zomato’s Blinkit, competitors such as Swiggy’s Instamart, Zepto, Amazon and others are actively competing for quick commerce market share, reports Moneycontrol. Jefferies has drastically cut Blinkit’s EBITDA forecast for FY26-27 and halved its target multiple for Blinkit to 6x, the report said.
“Overall for Zomato, the brokerage has cut its EBITDA estimates by 12 per cent for FY26 and 15 per cent for FY25, as well as profitability estimates by 17 per cent for FY26 and 18 per cent for FY27. Earnings per share (EPS) estimates have also been cut by 20 per cent for FY26 and 21 per cent for FY27,” reports Moneycontrol.
In the past 12 months, Zomato shares have rallied 91 per cent. Zomato’s rival Swiggy was also trading in the red. Swiggy shares were trading 1.77% lower at ₹522.70. According to the report, the quick commerce sector is expected to witness massive growth, with some estimates predicting the Indian market to reach US$5 billion by 2025 and US$9.94 billion by 2029.
The main drivers of growth include changing consumer preferences, the adoption of e-commerce, and the demand for convenience among millennials and Gen Z.
India’s quick commerce market is witnessing stiff competition among some of the key players: Zepto, Zomato’s Blinkit, and Swiggy’s Instamart.
“Zepto took the lead with nearly 11 million app downloads on Google Play and Apple’s App Store. Swiggy’s apps, which also include Instamart, saw 9.8 million downloads, while Blinkit had about 6.6 million downloads.
Tata’s BigBasket e-commerce offering, which offers BB Now within its main app, recorded about 3.5 million downloads, and Dunzo garnered less than a million downloads,” according to a report by India Briefing.
