On the Bombay Stock Exchange (BSE), on January 21, 2025, Zomato shares plummeted by over 10% to ₹215.80. The slump comes after the company provided weak Q3 results for FY 2024-25 when it stated that profits have been cut for the most part, although revenues have increased substantially.
For the quarter, Zomato’s net profit was ₹59 crore, which is 57.24% from ₹79 crore in the corresponding period of the previous year. However, consolidated revenue from operations jumped by as much as 64.38% to ₹5,405 crore. But, this gain was largely offset by the steep rise in total expenses of 63.55% to ₹5,533 crore.
This has put a lot of pressure on the profit margins due to the high investment made in Blinkit, its quick commerce wing. Blinkit’s revenues grew 117.23% to ₹1,399 crore, but the competition from the likes of Zepto, Swiggy Instamart and Tata’s BigBasket didn’t help.
Additionally, there was a big loss in the Indian market as BSE Sensex fell 778.51 points while NSE Nifty fell 189.10 points. This crash of the market coincided with the inauguration of the 47th President of the United States, Donald Trump, creating a global uncertainty.
Blinkit’s high risk investments by Zomato may result in growth in the long-run, but this does not sit well with the short-term profitability concerns given the market volatility.
