The Indian equities market remained under pressure for the second consecutive week amid the start of the Q2 earnings season. While the broader market saw a decline this week, new-age tech stocks witnessed a positive week. Seventeen of the 28 new-age tech stocks under Inc42’s coverage gained in a range of 0.02% to under 15% this week.

NSE Emerge-listed blockchain and IT development startup Yudiz emerged as the biggest gainer this week, with its shares jumping 14.51% to INR 64.70. 

Other gainers this week included fintech major Paytm, Awfis, FirstCry, Zomato, Menhood, IndiaMART InterMESH, among others. 

Interestingly, Nykaa ended the week flat at INR 192. During the week, the beauty ecommerce giant projected its revenue to grow in the “mid-twenties” in Q2 FY25. It also began its foray into the quick commerce segment with the launch of a 10-minute delivery pilot in some parts of Mumbai.

Meanwhile, shares of 10 startups ended the week in the red, dropping in a range of 0.10% to just under 9%. Ola Electric emerged as the biggest loser this week, with its shares falling 8.94% to INR 90.19. Zaggle, TAC Infosec, PB Fintech, Nazara Technologies, Yatra, and MapmyIndia were among the other losers this week.

In the broader market, Sensex ended the week 0.73% lower at 81,381.36 and Nifty 50 fell 0.46% to 24,964.25. 

Geojit Financial Services’ head of research Vinod Nair said that there is a bearish sentiment due to subdued estimates for Q2 earnings. 

“The Indian market is currently in a phase of consolidation due to premium valuations and a subdued outlook for Q2 results. In contrast, FIIs are capitalising on arbitrage opportunities in the Chinese markets, driven by stimulus measures and low valuations,” he added. 

During the week, the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) kept the interest rates unchanged. However, it changed its stance to “Neutral” even as the key focus remains on inflation.

“Looking at the current geopolitical scenario, the RBI had little choice but to remain focused on inflation and balanced growth at the same time. By keeping the repo rates unchanged and shifting from ‘accommodation’ to ‘neutral’, the MPC has taken a very calculated stance and is being watchful,” Bajaj Broking’s managing director Manish Jain said. 

Meanwhile, the initial public offering (IPO) space for new-age tech companies was buzzing with activities this week as well. While Flipkart-backed logistics startup BlackBuck received SEBI’s go ahead for its INR 550 Cr IPO, Inc42 learnt that B2B marketplace unicorn Zetwerk has also initiated initial discussions with investment banker JP Morgan for an IPO. Meanwhile, edtech startup PhysicsWallah roped in Axis Capital, Kotak Mahindra Capital, Goldman Sachs, and JP Morgan as the bankers for its proposed IPO next year. 

Now, let’s take a deeper look at the performance of the new-age tech stocks this week. 

The total market capitalisation of the 28 new-age tech stocks under Inc42’s coverage grew to $81.48 Bn at the end of this week from $80.85 Bn last week.

Controversies Hit Ola Electric’s Ride

The share prices of two-wheeler EV major Ola Electric took a hit this week as the company found itself amid controversies and a lot of scrutiny. Ola Electric’s shares ended nearly 9% lower this week, with its market capitalisation falling to $4.72 Bn. 

Ola Electric was in the news this week for: 

• Last Sunday, Ola Electric founder and CEO Bhavish Aggarwal engaged in a social media spat with comedian Kunal Kamra on the latter’s comments on the after-sales services of the former.
• Following this, the Central Consumer Protection Authority (CCPA) issued a show cause notice to Ola Electric for alleged violation of consumer rights, misleading advertisement and unfair trade practices.
• The Ministry of Heavy Industries (MHI) asked the Automotive Research Association of India (ARAI) to verify if the EV maker is honouring warranties and maintaining the requisite service centres.

Despite the issues, brokerages remain bullish on the company. Goldman Sachs has a ‘Buy’ rating on the stock, with a price target of INR 160. BofA Securities also initiated its coverage on the company with a ‘buy’ rating and a price target of INR 145.

Another Strong Week For Paytm

Continuing on the recovery path, shares of Paytm briefly crossed the INR 750 mark this week after many months. The stock ended the week at INR 724.15, up 4.16% week-on-week. With this, its market cap also touched $5.48 Bn.

The upswing came after CEO Vijay Shekhar Sharma reiterated the fintech giant’s commitment to its core consumer payments business. Sharma said that Paytm will look to reinvest in the consumer payments business segment. 

“Payments remain our primary business, and the merchant side continues to be strong. However, we lost a significant consumer base due to regulatory constraints. Moving forward, we aim to reinvest in the consumer payments business area,” he said at a CII event on Monday. 

A day after his comments, Paytm shares surged over 15% to INR 753.60 on October 8.

The company’s decision to sell its entertainment ticketing business to Zomato for INR 2,048 Cr is expected to provide it the necessary capital to streamline operations and reinvest resources.

Earlier in October, Paytm also reaffirmed its plans to double down on the use of artificial intelligence (AI). As part of this, it recently announced the appointment of its payments CTO Manmeet Dhody as ‘AI Fellow’ to drive projects related to AI innovation in business. It also elevated senior VP of Technology Deependra Singh Rathore as its new payments CTO. 

EaseMyTrip Mulls Issue Of Bonus Shares 

Shares of travel tech startup EaseMyTrip touched a fresh 52-week low of INR 31.10 during the intraday trading on October 7. However, the stock gained later in the week to end at INR 34.20, a gain of 2.67% from the previous week. Its market capitalisation stood at $0.72 Bn at the end of the week. 

The gains come after the startup said its board will consider an issue of bonus shares on Monday (October 14).

With the announcement, EaseMyTrip ended the downward spiral which began at the end of the last month, when CEO Prashant Pitti divested a significant stake in the startup. On September 25, he sold 16.91 Cr shares for INR 37.22 apiece, 6.73 Cr shares for INR 37.42 per share, and 1 Cr shares for INR 38.28 apiece. With this, his ownership in the travel tech startup declined to around 14%, nearly half of the 28% at the end of the June quarter. 

EaseMyTrip has issued bonus shares twice in the past. In February 2022, the company issued bonus equity shares in a 1:1 ratio. Later, in October 2022, the board approved the issuance of bonus shares in a 3:1 ratio, along with a stock split.

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In a tumultuous week for the broader Indian market, new-age tech stocks witnessed mixed investor sentiment. Eleven of the 28 stocks under Inc42’s coverage gained in a range of 0.15% to just a little under 13% this week. 

Jaipur-based D2C male grooming brand Menhood emerged as the top gainer this week. Shares of Menhood’s parent Macobs Technologies ended the week at INR 145, up 12.93% from last week.

Other gainers of the week included Paytm, PB Fintech, Go Digit, RateGain, among others. 

Meanwhile, 17 startups ended in the red this week, falling in a range of 0.88% to over 7%. Car marketplace CarTrade emerged as the biggest loser this week, with its shares tanking 7.36% to end the week at INR 907.75.

Delhivery, EaseMyTrip, Nykaa, Awfis, Ola Electric, and Zomato were among the other losers this week.

It is pertinent to note that the market was closed on October 2 on account of Gandhi Jayanti. 

Meanwhile, the week saw the four-week momentum in the broader market coming to a screeching halt. While Sensex fell 4.5% to end the week at 81,688.45, Nifty50 went down 4.4% to 25,014.60.

Escalating geopolitical tensions in the Middle East triggered a decline in the global markets this week over their impact on fuel prices. Besides, the stimulus measures announced by China led to global investors shifting their focus to the Chinese market from the Indian market.

Vinod Nair, head of research at Geojit Financial Services, said that the decline in the Indian market was broad based this week. He expects the market to be under pressure for some time. 

“The spike in oil prices due to the mounting tensions in the Middle East may add input cost inflation and thereby impact the earnings visibility of domestic companies. The market is likely to witness a consolidation phase as the expensive valuation and unfavourable macro situation may influence investors to adopt a sell-on-rally strategy,” he said. 

Meanwhile, Hrishikesh Yedve, AVP of technical and derivatives research at Asit C. Mehta Investment Interrmediates, said that the indices broke their key support base and are indicating fresh weakness, which may lead to further downward movement.

Meanwhile, 41 companies filed their IPO papers in September, the highest ever recorded in a single month, amid the bull run in the broader markets. 

In the startup context, coworking space provider DevX became the latest to file a draft red herring prospectus (DRHP). Its public issue will consist solely of a fresh issue of 2.47 Cr equity shares. 

Besides DevX, foodtech major Swiggy, which filed its updated DRHP with SEBI on September 26, got shareholders’ nod this week to increase the size of fresh issue in its IPO to INR 5,000 Cr from INR 3,750 Cr earlier.

Commenting on the IPO trends, Pantomath Financial Services Group’s founder Mahavir Lunawat said, “Increasing number of growth stage businesses shall hit the street. Moreover, we will have a trend of multinationals coming to tap the Indian capital market. Besides, several other market liquidity parameters, notably monthly mutual fund flow has doubled since last quarter and we are getting close to INR 40,000 Cr of money every month. This has fuelled capital market buoyancy phenomenally.”

With that said, let’s take a deeper look at the performance of the new-age tech stocks this week. 

The total market capitalisation of the 28 new-age tech stocks under Inc42’s coverage dipped to $80.85 Bn at the end of this week as against $81.69 Bn last week.

Honasa’s UAE Troubles

Shares of Mamaearth parent Honasa Consumers plunged 6.27% to end the week at INR 427.95. With this, its market cap also fell to $1.65 Bn. 

It is pertinent to note that the stock touched an all-time high at INR 546.50 on September 10. 

The primary reason behind the decline in the stock price this week was a ruling by a Dubai court in connection with the company’s dispute with its former UAE distributor RSM General Trading. 

Honasa said on Friday that a Dubai court upheld its order directing attachment of its assets. However, the court rejected the RSM General Trading’s demand to cancel the trading licence of Honasa’s subsidiary Honasa Consumer General Trading LLC. 

The company said that it will appeal against the Dubai court’s latest ruling. Honasa also said that the order will have no financial impact, adding that it is in the process of initiating contempt proceedings against RSM General Trading in the Delhi HC for failing to comply with the court’s previous ruling.  

Despite this, the stock ended over 4% lower on the BSE on Friday.

On Saturday, the company clarified that it does not own any asset in the UAE and its Dubai subsidiary has been exempted from the attachment order. 

CarTrade Continues To Fall 

In its third consecutive week of loss at the bourses, shares of CarTrade saw a big dip this week. The stock crashed 7.36% to end the week at INR 907.75. Besides, its market cap also fell to $510 Mn. 

During the week, Goldman Sachs Asset Management said that it increased its stake in the startup to 7.19% from 5.15% at the end of the June quarter. Goldman Sachs, along with its associated entities, acquired an additional 9.78 Lakh shares of CarTrade via open market transactions, it said in an exchange filing. 

In the previous week, Warburg Pincus exited the startup by divesting its entire 8.64% stake in the auto marketplace for INR 375.1 Cr. Most of the shares were picked up by Mirae Asset Mutual Fund, which bought 30.22 Lakh shares at INR 920 per share. 

It must be mentioned that shares of CarTrade gained 6.02% to touch a 52-week high at INR 1,034.50 on the BSE during the intraday trading on September 25. However, the stock has fallen about 12% from there. 

TAC Infosec Gains On The Back Of International Expansion

Shares of NSE Emerge-listed TAC Infosec ended the week at INR 723, up 10.40% from last week. Its market cap also jumped to $90.16 Mn. 

The startup made multiple acquisition announcements this week. In an exchange filing on September 30, the cybersecurity startup said it acquired US-based CyberSandia with an aim to enhance its regional presence and expand its global operations. CyberSandia holds an exclusive government contract to provide IT services to New Mexico, it said.

Last month, the startup had said that it would acquire CyberSandia for $25,000.

TAC Infosec also announced the acquisition of WOS, a wholly owned subsidiary of TAC Cyber Security Consultancy LLC, based in the UAE. The move is aimed at meeting the growing demand for advanced cybersecurity services in the Gulf Cooperation Council (GCC) region.

“Both developments are part of TAC Security’s consistent growth and focus on innovation in the cybersecurity space. Its ESOF (Enterprise Security in One Framework) platform continues to be adopted by enterprises and governments worldwide to combat evolving cyber threats, enabling the company to lead the way in comprehensive vulnerability management and cybersecurity solutions,” the startup said in a statement. 

The new UAE subsidiary will enable the company to diversify its client base and provide cybersecurity services to cross-border clients throughout the GCC, according to the statement.

Earlier, TAC Infosec said it acquired 590 new customers in the first quarter of FY25, of which 149 clients came from the US. Back then, it said it was looking to bolster its global expansion. 

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Even as the broader market continued to rally, a majority of the new-age tech stocks ended in the red this week. Nineteen of the 28 stocks under Inc42’s coverage fell in a range of 0.2% to over 16% this week.

Travel tech startup EaseMyTrip emerged as the biggest loser as its cofounder and CEO Nishant Pitti offloaded almost half of his stake in the startup. The stock ended the week 16.27% lower at INR 34.85 on the BSE.

Fintech major PB Fintech was the second-biggest loser. After hitting a fresh all-time high last week, the stock ended this week 15.3% lower at INR 1,638.75 on the BSE.

Zomato, Ola Electric, TAC Infosec and Nazara Technologies were among the other losers this week. 

Meanwhile, travel tech startup TBO Tek emerged as the biggest gainer this week. Its shares ended the week 5.37% higher at INR 1,853.8. 

Including TBO Tek, nine new-age tech startups gained in a range of 0.35% to over 5% this week. Go Digit, ixigo, Paytm, MapmyIndia, Nykaa, DroneAcharya, Zaggle, and ideaForge were the other gainers this week.

The broader domestic market continued its upward march for the fourth consecutive week. Benchmark indices Nifty50 and Sensex hit fresh all-time highs on Thursday (September 26), zooming to 26,087 and 85,462, respectively. 

While Sensex ended the week 1.2% higher at 85,571.85, Nifty50 gained 1.5% to end at 26,175.15. The Fed rate cuts and stable economic data points continued to drive the bull run during the week. 

Commenting on the market performance, Vinod Nair, head of research at Geojit Financial Services, said, “A visible trend is that this rally was predominantly led by large cap stocks, which are relatively fairly valued compared to mid and small caps, which are showing signs of exhaustion. A risk to the rally is elevated valuations.”

It is pertinent to note that except Zomato, the rest of the 27 tech stocks under Inc42’s coverage are all mid and small cap stocks.

Moving forward, Nair believes that investors will be focusing on the Q2 earnings. 

Meanwhile, Hrishikesh Yedve, AVP of technical and derivatives research at Asit C. Mehta Investment Interrmediates, said that the rally is likely to continue in the short term.  

“Technically, the weekly scale index has formed a big green candle. Moreover, the index on a weekly scale has managed to close above the breakout of the rising channel pattern, indicating strength. In the short term, as long as Nifty holds above the breakout level of 26,000, a “buy on dips” strategy should be adopted. On the upside, 26,500 will be an immediate short-term target for the index,” he added. 

It is worth noting that the Indian startup ecosystem is set to witness two much-awaited public market debuts. This week, foodtech major Swiggy filed its updated draft red herring prospectus (DRHP) with the Securities and Exchanges Board of India (SEBI), while fintech unicorn MobiKwik received the market regulator’s approval for its IPO. 

The fintech unicorn is set to raise INR 700 Cr from its IPO, which comprises only a fresh issue of equity shares. Meanwhile, Swiggy’s proposed IPO comprises a fresh issuance of shares worth INR 3,750 Cr and an offer for sale (OFS) component of 18.53 Cr equity shares. 

If and when the two IPOs materialise, the total count of new-age IPOs this year will zoom up to 12. 

“As global markets recalibrate after 2021’s peak, India is stepping into the spotlight with unprecedented vigour. This year, the Indian IPO market is poised for a significant leap, with large corporations in IPO Street, demonstrating growing investor confidence in the Indian market. Both local and international investors are driving this momentum, and all signs point to continued growth and opportunities ahead,” Pantomath Capital Advisors said. 

With that said, let’s take a deeper look at the performance of the new-age tech stocks this week. 

The total market capitalisation of the 28 new-age tech stocks under Inc42’s coverage dipped to $81.69 Bn at the end of this week as against $85.49 Bn last week.

Paytm Continues Its Bull Run

After a significant dip in its share prices earlier this month, fintech major Paytm has been on a slow and steady upward movement on the bourses. 

After slipping to the INR 325 level in February, shares of the startup have more than doubled in seven months. Shares of Paytm ended this week 1.32% higher at INR 672.4 on the BSE.

Recently, brokerage firm Emkay Global changed its rating on the stock to ‘add’ from ‘reduce’. It also raised Paytm’s price target (PT) to INR 750 apiece from INR 375 earlier. 

The brokerage believes that Paytm’s loan distribution business will gradually reaccelerate and pointed out that its broking and insurance distribution business has already turned profitable.

Further, it also said that the sale of its “heavy” movies and events ticketing business to Zomato is also expected to pay dividends in the remainder of the ongoing fiscal, as it will add on to its cash reserves and reduce net loss. 

For the first time since the RBI slapped restrictions on Paytm Payments Bank earlier this year, the stock touched a price of INR 724.85 during the intraday trading mid-week.

However, it is pertinent to note that Paytm shares are still trading 65.61% lower than their listing price. Speaking about the startup’s listing in November 2021, Paytm CEO and founder Vijay Shekhar Sharma recently lamented the choice of the investment bankers. 

“I have been an entrepreneur long enough now. I have a regret of not choosing the correct bankers for the IPO,” Sharma said during Tie Delhi NCR’s India Internet Day 2024 on Friday (September 27).

ICICI Securities, JP Morgan, Goldman Sachs, Morgan Stanley, HDFC Bank, and Citi were its investment bankers. 

PB Fintech Dips After Report Of Foray Into Healthcare Sector

After touching an all time high of INR 1,966 on September 20, shares of the fintech major witnessed a downward spiral to end the week at INR 1,638.75. This marked a 15.3% decline in its share prices on a week-on-week basis.

The selling pressure came after CNBC-TV18 reported about the company’s plans to foray into the healthcare sector on Wednesday (September 25). The report cited sources as saying that the startup is exploring plans to venture into the healthcare sector by establishing its own chain of hospitals.

“This move aims to unlock new value within the healthcare ecosystem, diversifying the company’s portfolio beyond its current focus on insurance and financial services,” the report said.

As the stock came under pressure following the report, PB Fintech issued a clarification stating the company has not confirmed any plans as of now. Further, it said that it will intimate the bourses “if and when” it arrives on a decision around its healthcare foray.

“We believe if claims were a quicker and smoother experience it would increase the number of people buying health insurance. It would be much better if interests were aligned between insurers and hospitals to give customers amazing claims experience and we believe that would grow insurance penetration,” the company said.

Meanwhile, Morgan Stanley said after the healthcare report that it is premature to evaluate any potential financial effects from PB Fintech’s healthcare venture since the management has not shared any additional details. The brokerage believes that investor sentiment regarding the stock will largely hinge on the scale of the capital expenditure – whether it is a one-time cost or an ongoing commitment.

The brokerage retained its ‘equal-weight’ rating on the stock with a PT of INR 1,375.

BofA also recently upheld a ‘Neutral’ rating on PB Fintech, setting a PT of INR 1,975. 

EaseMyTrip Tanks As Founder Reduces Stake 

Shares of EaseMyTrip closed 16.27% lower at INR 34.85 this week. The shares plummeted to touch the lower circuit at INR 32.78 apiece mid-week amid major block deals in the company.

This led to its market cap falling to $737.65 Mn at the end of this week from over $880 Mn last week.

On September 25, EaseMyTrip CEO Nishant Pitti sold 24.65 Cr shares in the startup through multiple block deals worth INR 920 Cr. 

Pitti’s stake in the travel tech startup decreased to about 14% from over 28% at the end of the June quarter, when he held 49.84 Cr shares.

However, the startup also made a few other announcements this week. This included EaseMyTrip’s exclusive partnership with PhonePe to launch its “hotels segment” on the fintech platform, which would allow PhonePe users to access services such as hotel deals, special offers, and cab services.

Last week, the company revealed plans to acquire a 30% stake in Rollins International Private Limited for INR 60 Cr ($7.15 Mn) and a 49% stake in Pflege Home Healthcare Center LLC for INR 30 Cr ($3.5 Mn).

Shares of EaseMyTrip are trading 14.13% lower year to date.

The post Bloodbath In New-Age Tech Stocks Despite Broader Market Rally, EaseMyTrip Biggest Loser This Week appeared first on Inc42 Media.

The Indian equity market continued its upward march this week, with the benchmark indices touching all-time highs. Despite this bull run, investor sentiment towards new-age tech stocks took a hit during the week. Eighteen of the 28 startups under Inc42’s coverage declined in a range of just below 1% to under 7% this week. 

Recently listed travel tech startup ixigo took the biggest hit this week, with its shares plunging 6.99% to INR 144.75. Unicommerce, FirstCry, Awfis, Go Digit were among the other stocks which ended in the red this week. Shares of gaming major Nazara also dipped 1.55% to end the week at INR 1,034.10 despite its acquisition spree and plans to raise INR 900 Cr funding. 

Meanwhile, 10 new-age tech stocks gained in a range of just under 1% to over 8% this week. The biggest gainer this week was NSE Emerge listed D2C brand Menhood, with its shares gaining 8.51% to end the week at INR 137. PB Fintech, Zomato, Paytm, and RateGain were among the other gainers this week. 

Amid this, Nifty 50 and Sensex touched their all-time highs on Thursday (September 19) and Friday (September 20). This was the third consecutive week when the indices tested new all-time high marks. Sensex ended the week 1.9% higher at 84,544.31, while Nifty 50 jumped 1.7% to end at 25,790.95.

The major driver of this bull run was the interest rate cut by the US Federal Reserve in the middle of the week. The US Fed cut the interest rate by 50 basis points for the first time in nearly four years. 

Vishal Goenka, co-founder of IndiaBonds.com, noted that the Fed’s decision comes amid significant differences in central bank policies worldwide. For example, Brazil’s central bank raised rates this week, and the Bank of Japan is also considering a similar move.

“India has remained well insulated from the rest of the world rate movements for now and the tremendous rally in risk assets plus projected economic growth keep an inflationary underlying force in the economy,” he said. 

Asit C. Mehta Investment Interrmediates’ AVP of derivatives research Hrishikesh Yedve said that the ongoing bullish momentum is likely to continue and take Nifty 50 towards 25,900-26,000 levels.

“On the upside, 26,000 will act as an immediate hurdle for Nifty. On the downside, 25,500 will serve as an immediate support for Nifty, followed by 15-DEMA support, which is placed near 25,300 levels. As long as Nifty stays above 25,600, a “Buy on Dips” strategy is advisable for traders,” he said. 

Amid the bull run on the bourses, the IPO boom also continues in the Indian equity market. Foodtech major Swiggy is expected to publicly file DRHP soon for its mega IPO. It is said to be looking to raise $1.4 Bn through the IPO. Its IPO is likely to comprise a fresh issue of equity shares worth INR 3,750 Cr ($450 Mn) and an offer-for-sale (OFS)  component worth INR 6,664 Cr (around $799 Mn). 

Commenting on the IPO trends, Pantomath Capital Advisors said, “With 59 IPOs raising INR 63,862 Cr  in 2024 and an average first-day gain of 30%, far above the global average of 22%, the demand for Indian IPOs is clear. Both local and international investors are driving this momentum, and all signs point to continued growth and opportunities ahead.”

With that said, let’s take a deeper look at the performance of the new-age tech stocks this week. 

Despite stock prices dipping, the total market capitalisation of 28 new-age tech stocks under Inc42’s coverage stood at around $85.49 Bn at the end of this week as against $82.93 Bn at the end of last week.

PB Fintech Zooms To New Highs

Shares of the parent of Policybazaar touched a fresh all-time high of INR 1,966 on September 20. The stock ended the week at INR 1,934.70, up 6.67% from last week. With the rally, PB Fintech’s market cap zoomed past the $10 Bn mark, touching $10.56 Bn by the end of the week. 

The rally came two weeks after the startup released its annual report, in which its founders Yashish Dahiya and Alok Bansal said that it will focus on improving its claim process. PB Fintech is also aiming to increase the share of secured loans in its total disbursal to 50% by FY26 from 12% now.

“Average is a terrible metric, especially in the risk category. We already work with partners to look at digitally acquired risk, and how we can look at smaller & smaller customer segments to provide the right product. Similarly, the claims experience is as much about the Insurer side processes as it is about the actual experience in the garage or hospital,” the founders said. 

For the uninitiated, PB Fintech operates digital insurance marketplace Policybazaar, lending platform Paisabazaar, online platform for financial products.

In the first quarter of the financial year 2024-25 (Q1 FY25), PB Fintech reported a consolidated net profit of INR 59.98 Cr as against a loss of INR 11.9 Cr in the year-ago quarter. It was its third consecutive profitable quarter. Operating revenue surged 51.8% to INR 1,010.5 Cr in Q1 FY25 from INR 665.6 Cr in the year-ago quarter.

Zomato’s Market Capitalisation Goes Past $30 Bn Mark

Zomato also saw its share price touch a fresh all-time high this week. The startup’s shares touched INR 292.90 on September 20 before ending the week at INR 290.70. The stock zoomed 6.52% week-on-week. 

With the bull run, the market cap of Zomato crossed the $30 Bn mark and stood at $30.75 Bn at the end of the week. 

The company’s shares have been rallying for almost a year on the back of its strong financial performance. Zomato’s profit after tax in FY24 stood at INR 351 Cr as against a net loss of INR 971 Cr in the previous fiscal. Besides, its EBITDA also grew to INR 42 Cr as against an EBITDA loss of INR 783 Cr it made in the year.

Zomato’s consolidated net profit zoomed multifold to INR 253 Cr in Q1 of FY25. Its revenue from operations jumped 74% to INR 4,206 Cr in Q1 FY25 from INR 2,416 Cr in the corresponding quarter last year.

Moving forward, the company is working on scaling up its going out vertical with the launch of its new app ‘District’. For this, it announced the acquisition of the entertainment and ticketing business of Paytm for INR 2,048 Cr in August. 

Following this, JP Morgan’s revised price target (PT) of Zomato’s stock’s price target (PT) to INR 340, indicating a 40% upside on September 5.

The brokerage attributed its bullish outlook to Zomato’s expansion of Blinkit, which has been successfully scaled across all major metro cities after demonstrating its viability in the NCR region. 

The brokerage anticipates Blinkit’s scale will significantly boost monetisation through channel margins and advertising revenue. Moreover, improved store-level economics are expected to enhance the company’s EBITDA outlook further, it said. 

Meanwhile, Zomato’s GST troubles continued to grow deeper in the week. In the week, West Bengal GST authorities slapped a fresh tax demand and penalty order of over INR 17.70 Cr in the week.

ixigo Emerges As The Biggest Loser This Week

Shares of ixigo continued to go down during the week, dropping 6.99% to INR 144.70. With this, its market cap also declined to $671.7 Mn (INR 5,607.95 Cr). 

Founded in 2007 by Aloke Bajpai and Rajnish Kumar, ixigo generates revenue by selling a variety of travel services, including flights, trains, bus tickets, hotel bookings, and holiday packages. 

Recently, ixigo’s bus ticketing platform AbhiBus partnered with German travel tech company FlixBus as the latter expands its presence in India. 

In Q1 FY25, ixigo posted a 78% increase in its PAT to INR 14.85 Cr compared to INR 8.36 Cr in the year-ago quarter. Revenue from operations rose 16% to INR 181.87 Cr from INR 156.55 Cr in Q1 FY24.

Gross transaction value surged 26.6% to INR 2,988.1 Cr during the quarter as against INR 2,359.1 Cr in Q1 FY24. The startup’s EBITDA soared 62% year-on-year to INR 19.2 Cr in Q1 FY25.

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Indian new-age tech stocks witnessed a mixed week despite the bull run in the broader market, which resulted in benchmark indices soaring to fresh all-time highs.

Fifteen of the 28 new age tech stocks under Inc42’s coverage gained in a range of 0.54% to just under 23% this week. Shares of fintech major Zaggle zoomed to a fresh all-time high of INR 446.40 this week. The stock emerged as the biggest gainer, zooming 22.64% during the week. Recently listed SaaS startup Unicommerce, gaming major Nazara Technologies, Paytm, PB Fintech, and FirstCry were among the other major gainers this week.

Besides Zaggle, the week saw shares of two startups, Mamaearth parent Honasa and foodtech major Zomato, hit fresh all time highs. Zomato gained 4.94% this week to end at INR 272.90, but Honasa slumped 7.20% to end the week at INR 493.45 to end as the biggest loser this week. 

Besides the BPC major, the week saw shares of 13 startups fall in a range of 0.56% to over 7%. Last week’s top gainer TAC Infosec, Nykaa, Awfis and Fino Payments Bank were among the stocks which ended the week in the red.

Meanwhile, benchmark indices Nifty 50 and Sensex touched their all-time highs on Thursday (September 12). While Sensex gained 2.1% this week to end at 82,890.94, Nifty 50 jumped 2% to end at 25,356.50. 

“Despite volatility, DIIs and FIIs flows remained positive as a strong monsoon, and an expectation of an uptick in demand during festive season drove investor sentiment….The market hit a new high as the rate-cut optimism globally (ECB & US Fed) has provided a positive impetus across the global markets,” Vinod Nair, head of research at Geojit Financial Services, said.

In the coming week, Nair believes that market trends will be shaped by the US Fed meeting next week, during which it is expected to announce a rate cut. 

Amid the bull run, the IPO spring continues in the Indian equities market. Pantomath Capital Advisors said that IPO fundraising hit a 27-month high in August, with 10 companies cumulatively raising INR 17,047 Cr.

Moving forward, it expects domestic companies to raise over INR 1.50 Lakh Cr through IPOs in the next 12 months, signalling continued activity and strong investor interest ahead.

Banking on this, Ather Energy became the latest new-age tech startup to file its DRHP with SEBI for an IPO. According to the electric vehicle manufacturer’s DRHP, filed on September 9, its proposed IPO will be a combination of a fresh issue of equity shares worth INR 3,100 Cr and an offer-for-sale (OFS) of up to 2.2 Cr equity shares. 

Now, let’s take a deeper look at the performance of the new-age tech stocks this week.

Overall, the total market capitalisation of 28 new-age tech stocks under Inc42’s coverage stood at around $82.93 Bn at the end of this week as against $79.38 Bn at the end of last week.

Zaggle Soars To New Heights

Almost a year after its listing, shares of fintech SaaS startup Zaggle Prepaid Ocean Services are seeing a renewed investor interest. The startup’s shares zoomed 22.64% this week to end the week at INR 437.20. Its market cap also zoomed past $630 Mn this week.  

The startup’s shares have been on an upward momentum in September on the back of multiple new account wins. Zaggle announced bagging contracts from the likes of Blue Star, FCM Travel Solutions, HDFC ERGO, and Founderlink technologies this month so far.

For the uninitiated, Zaggle provides employee expense management platform, corporate employee rewards platform, among others, to enterprises. 

In its annual report, Zaggle claimed to be India’s leading prepaid card issuer, with over 50 Mn cards distributed and more than 2.73 Mn users as of March 31, 2024. Further, it onboarded 620 new corporate clients, including marquee names such as Wipro, Bennett Coleman, and Emcure Pharmaceuticals, in FY24. 

Zaggle’s net profit stood at INR 44 Cr in FY24 as against INR 23 Cr in the previous fiscal year. Operating revenue grew 40% year-on-year to INR 775.6 Cr in FY24.

The startup is aiming to increase its revenue by 45-55% in the ongoing fiscal year. Zaggle’s managing director and CEO Avinash Ramesh Godkhindi said in its annual report, that the increase is expected to come from the startup’s strategy to scale up its products – Zoyer and Save and Propel, and enhance cross-selling efforts. 

“We are diligently working on our US expansion by precisely identifying our Ideal Customer Profile (ICP) and our Product Market Fit (PMF) to ensure targeted success,” Godkhindi said. 

Bulk Deals Derail Honasa’s Momentum

The upward momentum seen in Honasa’s shares since the announcement of its Q1 results came to a halt this week. The stock declined 7.2% to end the week at INR 493.45. However, it started the week on a strong note, touching an all-time high of INR 546.5 during intraday trading on September 10. The jump also led to its market cap breaching the $2 Bn mark.

The upswing came after HSBC reaffirmed its “buy” rating for Honasa and raised its price target to INR 570 from INR 550 earlier. 

The brokerage said that Honasa is expected to achieve over 20% structural growth in the coming years, driven by ongoing margin improvements. It also said that the startup’s house of brands strategy will increase its market share across various high-growth personal care sectors. 

Amid this bull run, a host of the startup’s investors offloaded shares on September 12. Peak XV Partners, Fireside Ventures, Stellaris Venture Partners, among others, cumulatively sold shares worth INR 1,601.68 Cr via bulk deals. The shares were lapped up by Morgan Stanley and ICICI Prudential Life Insurance Company. 

Following the bulk deals, the startup’s shares plunged nearly 6% on September 12 itself. 

Meanwhile, ICICI Prudential’s stake in Honasa increased to 5.48% following the acquisition of fresh shares.

Markets Respond Positively To Nazara’s Acquisition Spree

Gaming major Nazara continued its expansion spree this week and investors reacted positively to it. The shares of the company ended the week 14.05% higher at INR 1,050.40. With this, its market cap rose to over $950 Mn this week. 

Here’re the major events related to the startup from this week: 

• Nazara disclosed its plans to acquire a 15.86% stake in gaming community platform GetStan Technologies Pte. Ltd (STAN) for INR 18.4 Cr (around $2.2 Mn). The purchase will be made through its wholly owned subsidiary Nazara Dubai FZ via a secondary transaction.
• The startup will be making its biggest bet in the form of purchase of a 47.7% stake in online poker platform Pokerbaazi’s parent Moonshine Technology for INR 831.5 Cr through a secondary transaction.
• Nazara’s board is scheduled to decide on approving raising of fresh funds by issuance of equity shares on a preferential basis on September 18.

With the two new acquisitions, Nazara added on to its expansion spree from FY24. In the prior fiscal, it acquired 100% stake in Paper Boat and NextWave. Its subsidiary Sportskeeda acquired Pro Football Network, SoapCentral and Deltia’s Gaming. 

Its gaming subsidiary  NODWIN acquired Freaks4U Gaming, Branded Pte. Ltd, Comic Con India, PublishME, and Ninja Gaming to expand globally.

In its annual report, Nazara reiterated its focus on acquisitions to shore up its revenue. It said it will expand its portfolio of core gaming IPs and reinvest generated cash to acquire new IPs and grow satellite businesses. 

Besides, it is also focusing on esports and adtech entities and expects these ventures to expand into areas like physical play, toys, and AR/VR/XR in the future. 

“With substantial cash reserves and a strong M&A pipeline, we are well positioned to seize further growth opportunities and enhance our trajectory through strategi M&As over next couple of years, driving the future of gaming worldwide from our strong foundation in India,” Nazara’s joint MD and CEO Nitish Mittersain said.

The post New-Age Tech Stocks See A Mixed Week Despite Rally In Broader Market, Zaggle Biggest Gainer appeared first on Inc42 Media.

Indian new-age tech stocks saw a mixed week on the bourses amid a slump in the broader domestic equities market due to global market volatility.

Fifteen of the 28 new-age tech stocks under Inc42’s coverage fell in a range of 0.3% to 10% during the week, with Unicommerce emerging as the biggest loser.

Meanwhile, shares of DroneAcharya declined 8.9%, followed by Ola Electric’s shares nosediving about 7.1% during the week.

Among the other top losers were Menhood, ixigo, Paytm, PB Fintech, Yudiz, and MapmyIndia – all down between 3% and 5%.

Yatra, ideaForge, Delhivery, and FirstCry declined more than 2% but below 3% this week.

On the other hand, NSE Emerge-listed TAC Infosec emerged as the biggest gainer this week, with its shares rallying 10.6%.

Among the other 12 gainers during the week were CarTrade, Mamaearth, Nykaa, Zomato, Awfis, and TBO Tek, with their shares rising in the range of 2% to 7%.

In the broader market, Sensex fell 1.43% to end the week at 81,183.93 and Nifty 50 declined 1.52% to end at 24,852.15. On Friday (September 6), Sensex and Nifty 50 declined 1.24% and 1.17%, respectively.

Speaking on the broader market slump, Vinod Nair, head of research at Geojit Financial Services, said that the domestic market came under pressure on Friday as SEBI’s deadline over disclosure norms for FIIs neared. However, this would not impact India’s lucrativeness to FIIs in the long term, he said.  

Besides, elevated valuations continue to be a concern and the indices are expected to witness a muted trend in the short term, Nair added.

Meanwhile, Siddhartha Khemka, head of research, wealth management, at Motilal Oswal, said that the domestic equities experienced the most significant single-day decline over the past month on Friday due to concerns over a potential slowdown in the US labour market. 

“We expect consolidation mode to continue in the market over the near term,” Khemka added.

Despite the volatility, the IPO optimism remains high. As per reports, Ather Energy is set to file a DRHP with the SEBI for an INR 4,000 Cr+ public offering, almost a month after the INR 6,000 Cr+ IPO of its rival EV player Ola Electric.

Now, let’s take a deeper look at the performance of the new-age tech stocks this week.

Overall, the total market capitalisation of 28 new-age tech stocks under Inc42’s coverage stood at around $79.38 Bn as against $80.19 Bn at the end of last week.

All Eyes On EV: EaseMyTrip Forays Into Ebus Making

In an interesting development, online travel aggregator EaseMyTrip announced incorporating a new wholly owned subsidiary Easy Green Mobility to start electric bus manufacturing.

It is looking to invest INR 200 Cr for R&D, product development, and setting up a manufacturing plant over the next 2-3 years. 

While Easy Green Mobility will manufacture ebuses, EaseMyTrip will operate these buses via its other subsidiary YoloBus.

The shares of EaseMyTrip, which have remained volatile with a downward trend since the beginning of the year, jumped over 12% following the announcement on Thursday and ended the day’s trading around 11% higher at INR 43.08 on the BSE. However, the shares slumped the next day to end the week over 6% lower at INR 40.42. 

Unicommerce Slumps After Releasing Q1 Numbers

Shares of recently listed Unicommerce slumped in all five trading sessions this week after posting its Q1 FY25 earnings last Friday (August 30).

With a sharp decline of a little over 10% during the week, the SaaS startup turned out to be the biggest loser. Unicommerce shares ended the week at INR 197.25 on the BSE.

It is pertinent to note that the startup’s profit after tax (PAT) jumped 31% year-on-year to INR 3.51 Cr in Q1 FY25. Even on a quarter-on-quarter (QoQ) basis, profit rose 22%.

Meanwhile, revenue from contract with customers increased 9.2% YoY and 3.5% QoQ to INR 27.46 Cr during Q1.

The sudden fall in its share price could be due to profit booking. Unicommerce made its debut on the bourses at a whopping 113% premium to its issue price. Currently, the shares are trading 14.2% lower than the listing price of INR 230 on the BSE but 82.6% higher than the issue price of INR 108 apiece.

Brokerages Continue To Be Bullish On Zomato 

Shares of foodtech major Zomato, which have surged over the past year or so over its increasing profits and plans to diversify revenue stream, again received thumbs up from brokerages this week.

CLSA raised its price target (PT) on Zomato to INR 353 from INR 350, which currently implies an upside of about 36% to its last close. The brokerage said that its PT increase was to reflect Zomato’s recent acquisition of Paytm ticketing business.

Besides, it also said, “Quick commerce is reshaping India’s retail supply chain by flattening distribution, giving new brands increased visibility and price competitiveness. Blinkit’s parent Zomato will be the largest listed beneficiary, while staples marketers Marico and Hindustan Unilever face risks as their distribution advantage erodes.”

CLSA also sees Zomato’s Blinkit, Zepto, and Swiggy Instamart reaching $10 Bn in gross order value by FY26 and surpassing $78 Bn within a decade.

Meanwhile, JP Morgan also raised Zomato’s PT to INR 340 from INR 208 earlier, implying about a 31% upside to the stock’s last close, on the back of the company’s quick commerce growth. 

In line with the increase in PTs, shares of Zomato jumped over 7% in the last two trading sessions during the week. The stock ended Friday’s trading at INR 260.05 on the BSE, gaining 3.7% overall during the week.

Continuing its spree of experiments, Zomato announced the launch of ‘dark mode’ this week. Its rival, IPO-bound Swiggy also seems to be on the experimentation mode and has launched a number of new features and services over the past few months. This week, Inc42 reported that Swiggy is piloting a large order fleet in the Delhi NCR region.

The post New-Age Tech Stocks Witness A Mixed Week, Unicommerce Biggest Loser With A 10% Fall appeared first on Inc42 Media.

Despite a prolonged bull run in the Indian stock markets, investors turned bearish on new-age tech stocks in the final week of August. Seventeen of the 28 stocks under Inc42’s coverage fell in a range of 0.33% to over 16%. 

Awfis emerged as the biggest loser this week, with its shares crashing 16.38% to end at INR 749.05. Last week’s top gainer TAC Infosec, Zomato, Ola Electric were among the other major stocks which declined this week.

Meanwhile, 11 new-age tech stocks rose in a range of just under 1% to over 12% this week. While Paytm emerged as the top gainer, Go Digit, TBO Tek, PB Fintech, and Honasa were among the other winners this week. 

It must be mentioned that two startups touched fresh all-time highs this week. Shares of Mamaearth parent Honasa touched an all-time high of INR 528.9 on Monday (August 26) and ended the week 8.52% higher at INR 506.05 on the BSE.

TAC Infosec extended its bull run into the first half of the week, with its shares touching an all-time high of INR 853.15 on Tuesday (August 27). However, the cybersecurity SaaS startup’s shares lost steam in the latter part of the week. Overall, the stock declined 3.73% this week to end at INR 745.

In the broader market, Sensex grew 1.5% to end the week at 81,086.21 and Nifty 50 jumped 1.6% to end at 25,235.90. 

Motilal Oswal Financial Services’ research head Siddhartha Khemka attributed Moody’s upgrading India’s GDP growth forecast to 7.2% for 2024 and 6.6% for 2025 from the earlier estimates of 6.8% and 6.4%, respectively, as one of the reasons for the rally this week.

“This (GDP forecast update) and healthy MSCI inflow took markets to new highs. We expect the market to continue its northbound journey with stock-specific action,” he said. 

Meanwhile, D2C meat delivery startup Zappfresh became the latest new-age business to join the queue for a public listing. Earlier this week, its parent DSM Fresh Foods Ltd filed its draft red herring prospectus (DRHP) for listing on the SME platform of the BSE, BSE SME. 

On the IPO trend, Pantomath Capital Advisors said that 17 companies filed their DRHPs with SEBI in the month of August, making it the highest number of monthly filings in over a year. Pantomath anticipates this trend to continue for the remainder of the year. 

“Recently listed IPOs have performed exceptionally well, boosting confidence among both companies and investors. This renewed optimism is prompting investors to look at opportunities in the primary market and driving promoters to raise funds through IPOs,” it said. 

Overall, the total market capitalisation of 28 new-age tech stocks under Inc42’s coverage stood at $80.19 Bn at the end of this week as against $81.39 Bn last week. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week. 

Good News For Paytm 

Paytm, which has been hit by regulatory troubles this year, saw a couple of positive developments bolster investor sentiment towards the stock. Shares of Paytm gained 12.14% this week to close at INR 621.80.

Here’s more on the developments: 

• The Vijay Shekhar Sharma-led startup sold its events and movies ticketing business to Zomato for INR 2,048 Cr in an all-cash deal.
• Paytm received the long-pending approval from the Centre for its investment in its payments arm, Paytm Payment Services Limited (PPSL). With this, it will reapply for a payment aggregator (PA) licence from the Reserve Bank of India (RBI).

Getting the PA licence will help the company add new customers for providing online payment aggregation services. 

In a report, brokerage Jefferies said that the immediate business impact of the licence could be marginal for Paytm. However, it has a price target (PT) of INR 420 on the stock, representing nearly 32% downside from its last close.

Besides, Motilal Oswal, on the Zomato-Paytm deal, said that the sale of the entertainment business would offer a financial boost to Paytm, generating significant cash that can be reinvested into other high-potential areas. It maintained a ‘Neutral’ rating on Paytm with a PT of INR 550, and expects the company to turn EBITDA positive by FY27.

Awfis’ Bull Run Ends

After an extended bull run on the bourses, shares of recently listed coworking space provider Awfis crashed this week. 

The startup’s shares plunged 16.38% to end the week at INR 749.05. Earlier on August 22, the stock had touched an all-time high of INR 945.70. 

During the week, Awfis announced a partnership with Nyati Group to set up an additional 3 Lakh square feet of Grade-A workspace in Pune.

Through the partnership, Awfis will introduce premium flexible workspaces in Nyati Group’s commercial properties of Nyati Empress in Pune’s Viman Nagar and Nyati Enthral in Kharadi. It will add 1,67,206 square feet of built up office space in the city. 

Awfis currently offers 1,12,038 seats across 185 centres in 17 cities. Moving forth, the startup plans to further expand across India by adding 40,000 new seats in FY25, taking the total seat count to 1,35,000.

Unicommerce, FirstCry Post First Financials After Listing 

On Friday (August 30), recently listed kids-focussed omnichannel retailer FirstCry and SaaS startup Unicommerce released their first financial results post their listing on the bourses earlier this month. 

FirstCry’s parent Brainbees Solutions reduced its consolidated net loss by 31% to INR 75.68 Cr in Q1 FY25 from INR 110.42 Cr a year ago. Operating revenue increased 10% to INR 1,652.07 Cr from INR 1,496.93 Cr in Q1 FY24. 

The company’s consolidated adjusted EBITDA surged 106% YoY to INR 74.3 Cr, with GMV rising 17% YoY to INR 2,318.3 Cr. FirstCry said it plans to invest INR 100 Cr in its UAE subsidiary to boost operations in the UAE as well as Saudi Arabia.

The company released its financial numbers after market hours. Prior to that, its shares closed at INR 641.40, which was a gain of 0.45% on a weekly basis.

Meanwhile, Unicommerce reported a 31% increase in profit after tax (PAT) to INR 3.51 Cr in Q1 FY25 from INR 2.68 Cr in the same quarter last year. 

Revenue from contracts with customers grew 9.2% year-on-year to INR 27.46 Cr, while total expenses rose 7% to INR 24.28 Cr. Further, its EBITDA surged 61% to INR 4.2 Cr, with EBITDA margin expanding to 15.3% from 10.4% a year ago. 

Unicommerce also declared its numbers after the close of the market. Its shares ended the week 2.90% lower at INR 219.25 on the BSE.

The post Most New-Age Tech Stocks End In Red This Week; Paytm Emerges Biggest Gainer appeared first on Inc42 Media.

New-age tech stocks gained this week on a rally in the broader market due to positive global cues. Eighteen of the 28 new-age companies under Inc42’s coverage rose in a range of 0.38% to just a little under 35% this week.

Cybersecurity startup TAC Infosec, which is listed on NSE Emerge, was the biggest gainer this week. Its shares surged 34.42% to end the week at an all time high of INR 773.90.

Other top gainers of the week included recently listed SaaS startup Unicommerce, coworking startup Awfis, last week’s top loser TBO Tek, and Mamaearth parent Honasa Consumer. 

Beauty and fashion ecommerce major Nykaa touched a fresh 52-week high twice during the week. The stock surged more than 9% to hit a fresh 52-week high of INR 229.9 apiece on the BSE during the intraday trading on August 23. Amid the bull run, its early investor Harindarpal Singh Banga offloaded around 4.1 Cr shares worth INR 851.5 Cr in a bulk deal on Friday. Overall, shares of Nykaa ended the week 16.99% higher/lower at INR 226.90on the BSE.

Meanwhile, 10 new-age tech stocks fell in a range of 0.20% to just under 5% this week. Last week’s top gainer Ola Electric emerged as the biggest loser, falling 4.93% to end the week at INR 126.21.

In the broader market, Sensex grew 0.8% to end the week at 81,086.21 and Nifty 50 jumped 1.1% to end at 24,823.15. 

Vinod Nair, head of research at Geojit Financial Services, said multiple global factors, including diminished likelihood of a recession in the US, ceasefire talks between Israel and Hamas, and decline in crude oil price, led to the rise in the benchmark indices. 

“However, inflationary pressure in Japan and the appreciation of the yen tempered the market’s gains at the end,” he added.

Among the recently listed new-age tech companies, Unicommerce ended the week with 19.09% gains. Meanwhile, FirstCry ended in the red.

It is pertinent to mention that startups like Swiggy, BlackBuck, Avanse Financial Services, Ecom Express, ArisInfra, among others, are awaiting the market regulator’s nod to make their public market debut.

Commenting on the surge in IPOs, Pantomath Capital Advisors said,  “A confluence of factors has boosted India’s primary market. The biggest reason is India’s strong macro environment, which has raised investor confidence. The healthy performance of several new stocks in the last couple of years has also lured investors into investing in new IPOs.”

Overall, the total market capitalisation of 28 new-age tech stocks under Inc42’s coverage stood at $81.39 Bn at the end of this week as against $77.52 Bn last week. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week. 

Zomato, Paytm End In The Red After Ticketing Deal 

Following months of speculation, foodtech major Zomato announced the acquisition of the entertainment ticketing business of Paytm for INR 2,048 Cr in an all-cash deal this week. 

With the acquisition, Zomato is looking to scale up its third B2C business, going out, with the launch of its new app ‘District’.

On the other hand, Paytm said that the move to sell the ticketing business will help it focus on its core payments and financial services distribution business. 

However, the deal seemed to have failed to enthuse the investors, as shares of both Zomato and Paytm ended in the red this week.

Zomato ended the week at INR 262.70, down 0.68% week-on-week. This was despite the startup touching a fresh 52-week high of INR 280 at the beginning of the week. 

Antfin Singapore Holding Pte Ltd, an investor in Zomato, also offloaded nearly half of its stake in the foodtech major in two block deals worth INR 4,771 Cr on August 20. 

Brokerages’ response for Zomato’s acquisition of Paytm’s ticketing vertical were largely positive. Emkay gave Zomato a price target of INR 270 by June 2025. Motilal Oswal maintained its ‘BUY’ rating for Zomato, with a target of INR 300. 

“District app could be a small part of Zomato’s business, but if executed correctly, it could give Zomato a strong mind share in the spending patterns of urban consumers across key forms of recreational or staple spending: groceries, food, and recreational “Going out” activities spanning dining, movies, sports, and music,” Motilal Oswal said. 

Meanwhile, Paytm declined 1.67% this week to end at INR 554.50. Post the announcement, Emkay gave Paytm parent One97 Communications a ‘Reduce’ rating and a price target of INR 375. Motilal Oswal gave a neutral rating with a target of INR 550.

Awfis Zooms On Expansion Announcement

On a bull run since its listing in May, shares of Awfis zoomed this week and reached an all-time high of INR 909.75 apiece on August 22. This marked a 110% increase from its listing price of INR 435. The shares of the startup ended the week with a gain of 25.18% at INR 900.45. 

This surge came after the startup announced the launch of two new centres at Mantri Commerce and Vista Pixel in Bengaluru. 

“We are confident that the demand for high-end workspaces will continue to surge in the years to come. Our new centres are strategically located to cater to this growing need, offering unparalleled amenities, cutting edge infrastructure, and a vibrant community that nurtures innovation and collaboration,” Awfis chairman and MD Amit Ramani said.

Awfis operates 1,12,038 seats across 185 centres in 17 cities currently. Moving ahead, it plans to further expand across India by adding 40,000 new seats in FY25, taking the total seat count to 1,35,000.

TAC Infosec Touches Fresh All-Time High 

Shares of cybersecurity startup TAC Infosec zoomed 34.42% this week to end at INR 773.90. The jump came after the company’s update on new customer additions on August 19. 

TAC Infosec said it acquired 250 new customers in July and 590 in the first quarter of financial year 2024-25 (Q1 FY25). 

While 149 of the new clients came from the US, the company also onboarded 20 new clients from India, including Cars24. Moving forward, TAC Security is looking to build on this momentum by upselling additional products and services to its newly acquired clients. 

The startup’s clients include Salesforce, MPL Gaming, Zepto, Juspay, Reliance ADA Group, among others. It has set a target to have 10,000 customers globally by March 2026 and 3,000 by March 2025. 

In a bid to bolster its global expansion bid, the startup also informed the bourses of its intent to acquire US-based cybersecurity firm Cyber Sandia. 

“Cyber Sandia holds a critical State-Wide Agreement with the State of New Mexico for IT Professional Services, which makes this strategic acquisition a key opportunity for TAC Security to significantly bolster its presence in the U.S. public sector. This will also enable the company to expand its cybersecurity services nationwide across the US—the largest market in the world,” the company said in a release.

TAC Infosec reported a net profit of INR 6.33 Cr in FY24, a jump of 23% from INR 5.12 Cr in FY23. 

The post New-Age Tech Stocks Rally In Line With Broader Market, TAC Infosec Top Gainer This Week appeared first on Inc42 Media.

New-age tech stocks witnessed a mixed week on the stock exchanges amid new startup listings and many startups making a beeline to go public. Most of the listed startups saw stock specific action in the final week of the Q1 FY25 earnings season.

Eleven of the 26 new-age tech stocks under Inc42’s coverage gained in a range of over 45% to a little under 1% this week. 

Recently listed electric two-wheeler maker Ola Electric emerged as the top gainer this week, with its shares surging 45.59% to end at INR 132.76. Other gainers included Paytm, Delhivery, Awfis, and Nyk2aa. 

On the other hand, 15 startups fell in a range of little under 10% to 0.37%. TBO Tek was the biggest loser this week. Its shares declined 9.23% to end the week at INR 1,572.40. ixigo, Honasa Consumer, and Nazara Technologies were among the other major new-age tech stocks which ended in the red. 

It is pertinent to note that markets were closed on August 15 on the occasion of India’s 78th Independence day. 

Meanwhile, the broader market saw a revival after a short slump this week. While Sensex gained 0.9% this week to end at 80,436.84, Nifty 50 gained 0.7% to end the week at 24,541.15. 

Analysts attributed the market recovery over the week to a trickle down effect of recovery in the global markets. Prashanth Tapse, senior VP (Research) at Mehta Equities, said that multiple factors improved the global market sentiment this week. “Positive US economic data like cooling inflation and robust retail sales numbers shrugged off recession fears while talks of a rate cut by the US Fed as early as next month fuelled a mega rally across global equities, including India,” he said. 

Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, said that the end of the Q1 FY25 earnings season on a positive note drove the markets recovery this week. 

“We expect the earnings momentum to continue with a steady growth of 15% over the next two years (FY24-26). Softening in US PPI data has raised hopes of rate cuts in the US. Thus, all eyes next week will be on US Fed meeting minutes. Overall, we expect the market to consolidate in a broader range and take cues from global factors,” he said. 

Amid all these, SaaS startup Unicommerce and omnichannel retail brand FirstCry made their market debuts on Tuesday (August 13). Shares of FirstCry’s parent Brainbees Solutions opened at INR 625 on the BSE, a premium of 34.4% to the issue price. Unicommerce listed at INR 230 on the BSE, a premium of 112.96%. Both the startups ended the week higher than their listing prices.

Including the new additions, the total market capitalisation of 28 new-age tech stocks under Inc42’s coverage stood at $77.52 Bn at the end of the week. In comparison, the market capitalisation of 26 new-age tech stocks stood at $72.05 Bn last week. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week. 

Ola Electric’s Big Show

After a flat listing on the BSE, shares of Ola Electric have continued to march upwards on the bourses. After touching the upper circuit of 20% on its listing day last week, shares of Ola Electric ended this week 45.59% higher at INR 132.76. 

Here’s a quick recap of the eventful week for Ola Electric as well as Ola Group: 

– The startup’s net loss rose 30% to INR 347 Cr in the June quarter of the financial year 2024-25 (Q1 FY25) from INR 267 Cr in the year-ago quarter. Meanwhile its operating revenue grew 32% to INR 1,644 Cr during the quarter under review from INR 1,243 Cr in Q1 FY24.

– During Ola’s annual “Sankalp” event, founder and CEO Bhavish Aggarwal unveiled three new motorcycles under Ola Electric’s portfolio – Roadster X, Roadster, and Roadster Pro. The bikes are priced in the range of INR 74,999 to INR 2,49,999.

– During the event, Aggarwal also revealed cells made at the startup’s Gigafactory. The company is scheduled to integrate these cells in its vehicles by Q1 FY26.

While Ola Electric continues to be riddled with losses, the startup claimed to have recorded the highest sales of its vehicles in Q1. Geojit Financial Services’ senior research analyst Saji John said that despite the loss in FY24, the company seems poised to achieve and enhance profitability in the long-term through improved scalability and vertical integration. 

Post its quarterly results and new product reveals, the startup’s market cap stood at $6.98 Bn at the end of the week. “With the current market share of 38% YTD and robust capex plan, Ola Electric is likely to act as a catalyst for boosting investors’ confidence and could help accelerate the growth and adoption of electric two-wheelers across the country,” John said. 

Nykaa’s Robust Q1 Show

Beauty and fashion ecommerce major Nykaa reported a 152% increase in its consolidated net profit to INR 13.6 Cr in Q1 FY25 from INR 5.4 Cr in the same quarter last year.

Operating revenue grew 22.8% to INR 1,746.1 Cr during the reported quarter from INR 1,421.8 Cr in Q1 FY24.

In a post-earnings call, Nykaa MD and CEO Falguni Nayar attributed the improvement in net profit to recent restructuring efforts and other strategic measures.

As a result of the strong Q1 show, Nykaa’s shares jumped as much as 5.8% to INR 197.35 during the intraday trading session on August 14. The stock ended the week at INR 193.95, witnessing a 1.02% WoW increase. 

Commenting on the stock, Amol Athawale, VP of technical research at Kotak Securities, said that Nykaa’s shares are trading around its 50-day moving average and expected to witness bullish market sentiment. 

“In the short-term time frame, Nykaa is witnessing consolidation. On the higher side, it is witnessing resistance at INR 202-204 and on the lower side 180-185 is the support area. Once it breaches the resistance area, we are of the view that Nykaa’s shares can reach INR 210-215 in the near future,” he said.

TBO Tek Slides Post Q1 Results 

B2B travel portal TBO Tek’s consolidated net profit increased 29% to INR 60.91 Cr in Q1 FY25 from INR 47.3 crore in the same period last year. Operating revenue grew 21% to INR 418.5 Cr during the quarter from INR 344.6 Cr in Q1 FY24. 

TBO Tek’s gross transaction value (GTV) stood at INR 7,940 Cr in Q1, reflecting a 14% year-on-year growth. The hotel segment accounted for 57% of the GTV, while the air segment accounted for 43%. In comparison the hotel and air segments accounted for 46% and 54% of the GTV, respectively, in Q1 2024. 

However, the stock closed at INR 1,572.40 on Friday, with a weekly loss of 9.23%. This was in line with the decline seen in other travel tech companies like Yatra, ixigo, and EaseMyTrip amid rising global tensions.

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New-age tech stocks suffered a heavy dent amid a crash in the broader market at the beginning of the week due to a rout in global equities markets. Eighteen of the 25 new-age tech stocks under Inc42’s coverage declined in a range of 0.21% to just under 8% this week. 

Recently listed travel tech startup ixigo emerged as the biggest loser this week, plummeting 7.59% to end at INR 163.20. Paytm, Nazara Technologies, Go Digit, MapmyIndia were among the other prominent losers. 

Amid all these, seven new-age tech stocks gained in a range of over 1% to just under 7%. Fino Payments Bank continued its rally this week as well to emerge as the biggest gainer. The payments bank’s shares zoomed 6.85%.

The week began with a turmoil in the global markets. Most Asian markets slumped on Monday (August 5) due to rising tensions in the Middle East,  weak US economic data spurring concerns on recession, tightening of monetary policy in Japan, among other reasons. 

As a result, benchmark indices Sensex and Nifty50 slumped 2.74% and 2.68%, respectively, on Monday. The India volatility index (VIX) jumped 42% to 20 levels, which, as per analysts, indicates a fear among investors of an economic slowdown.

The sell-off on Monday wiped out over $2 Bn from the market capitalisation of new-age tech companies. 

While the indices managed to recover some of the losses in the subsequent sessions, they still ended the week in the red. While Sensex declined 1.5% to end the week at 79,705.91, Nifty 50 slumped 1.4% to close at 24,367.50. 

Vinod Nair, head of research at Geojit Financial Services, said that this recovery came after the Bank of Japan (BoJ) said that it would not raise interest rates during periods of financial instability. 

“The Indian market experienced a marginal recovery from the uncertainties stemming from concerns about the unwinding of carry trades… While the carry trade issue appears to have eased for now, a gradual increase in interest rates by the BoJ could have some impact in the near future,” he said. 

Meanwhile, Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, said that the markets are likely to consolidate at higher levels due to mixed global cues and absence of any major domestic triggers.

“Over the past few days, Nifty has been volatile with some recovery seen in the last few days. India VIX descended from a level of around 20 to 15 during the week, showing easing cautiousness in the market and improvement in sentiments,” he said. 

Analysts believe that new-age tech stocks will see stock-specific action in the coming week, with some of the companies slated to report their Q1 numbers.

Amid the market turmoil, electric two-wheeler manufacturer Ola Electric became the first automobile manufacturer to get listed on Indian bourses in nearly two decades. Meanwhile, two other startups, FirstCry and Unicommerce, are set to list on the exchanges in the first half of next week. 

Overall, the total market capitalisation of the 26 new-age tech stocks, including Ola Electric, under Inc42’s coverage stood at $72.05 Bn at the end of this week. In comparison, the market capitalisation of 25 new-age tech stocks stood at $67.91 Bn last week.  

Now, let’s take a deeper look at the performance of new age tech stocks this week. 

Ola Electric’s Tepid Debut

The shares of the EV maker listed on Friday (August 9) flat at INR 75.99 on the BSE against its IPO issue price of INR 76. However, the stock rose 20% during the day to close at INR 91.18 apiece. 

It is pertinent to note that the company made its public market debut with a valuation of $4 Bn, 25% lower than its last private valuation of $5.4 Bn. After the jump in the share price on the first day, the startup’s market cap stood at about $4.79 Bn. 

Commenting on the company’s listing, Geojit’s Nair said that the market debut defied grey market expectations of a 4-5% discount. “The positive performance can be attributed to its healthy long-term outlook, 38% market share in two-wheeler EVs, benefits from the PLI scheme, and advantages of vertical integration,” he added. 

Meanwhile, Prashanth Tapse, senior VP of research at Mehta Equities, highlighted the short-term risks for the company. 

“Post listing, the short-term view remains the same due to weak financials and risk of negative cash flows in future. The allotted investors should understand the risks, which could adversely impact its consolidated financial condition post listing. Considering all the factors, we advise only risk-taking investors to continue to hold with a minimum holding period of 2-3 years,” he said. 

It is pertinent to note that Ola Electric continues to be a loss-making entity. In the financial year 2023-24 (FY24), its net loss widened 7.6% to INR 1,584.4 Cr from INR 1,472.1 Cr in the previous year. However, operating revenue jumped over 90% to INR 5,009.8 Cr during the year under review from INR 2,630.9 Cr in FY23.

As of now, all eyes will be on the company’s Q1 financial results, scheduled to be announced next week.

PB Fintech Touches All-Time High But Loses Steam 

PB Fintech, the parent of Policybazaar, reported a net profit of INR 59.98 Cr in Q1 FY25 this week as against a loss of INR 11.9 Cr in the year-ago quarter. While its core online business, which includes Policybazaar and Paisabazaar, grew 29% year-on-year (YoY) to INR 665 Cr, the new initiatives arm saw its revenue jump 131% YoY to INR 346 Cr. 

A day after it reported its results, shares of PB Fintech touched an all-time high of INR 1,664.35 on Wednesday (August 7). However, the stock declined in the subsequent sessions to end 2.93% lower week-on-week at INR 1,452.30. 

The decline can be majorly attributed to the bearish view of brokerages on the stock. Kotak Institutional Equities downgraded its rating on the stock from ‘add’ to ‘reduce’ post the financial disclosure, saying that the price leaves little room for business vagaries.  

Brokerage Nuvama increased its revenue estimates for PB Fintech but lowered margin expectations. 

Mamaearth Posts Robust Q1 Numbers 

Honasa Consumer Ltd, the parent company of D2C brand Mamaearth, reported a 62.9% increase in profit after tax (PAT) to INR 40.2 Cr in Q1 FY25 from INR 24.7 Cr in the same quarter last year.

Honasa continued to reap the benefits of its ‘house of brands’ strategy this quarter. It currently operates six brands – Mamaearth, Auqalogica, The Derma Co, Dr Sheth’s, BBlunt, and the recently-launched colour cosmetics brand Staze. The company noted that its product business increased 20.3%, driven by a volume growth of 25.2% in Q1 FY25.

It is pertinent to mention that brokerages have been bullish on Honasa’s house of brands approach in the past. Earlier in July, Emkay gave the company a price target of INR 525 by June 2025. 

“Our ground checks suggest faster scale up of new brands like The Derma Co and Aqualogica. We foresee a distribution shift in the top-50 towns aiding the Mamaearth brand, where repeats are ensuring. We expect enhanced profitability in hero SKUs, where Honasa is likely to reduce trade margin, given healthy repeats,” it said.

The company’s chairman and CEO Varun Alagh said that Honasa has captured a strong market share in the face wash category online while steadily gaining ground offline, “driven by its house of brands strategy and innovation capabilities”.

However, the company said it has discontinued its ayurvedic beauty products brand Ayuga. It cited the failure to establish a product-market fit (PMF) as the reason behind it. 

Shares of Honasa ended this week 4.31% higher, despite falling 4.6% on Friday to INR 473.35 ahead of the earnings announcement.

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New-age tech stocks surged on Wednesday (August 7) amid a rally in the broader equities market on positive global cues.

In line with the broader market gains, 21 out of the 25 new-age tech stocks under Inc42’s coverage gained in the range of 0.16% to 8.85% in today’s trade .

Menhood emerged as the biggest gainer, with its shares surging almost 9% to close the day at INR 107.6 apiece on NSE Emerge. Menhood made its stock market debut on July 24, with its shares listing at INR 96 apiece, a 28% premium over the issue price of INR 75 per share.

Menhood was followed by Zaggle, with the enterprise tech startup’s shares zooming 7.92% to close at INR 346.80 on the BSE.

Zomato, PB Fintech, MapmyIndia, Paytm and Yatra were among the other major gainers today.

It is pertinent to mention that PB Fintech shares opened at an all-time high of INR 1,664.35 on the BSE today after the parent entity of insurtech major Policybazaar posted a consolidated net profit of INR 60 Cr in the April-June quarter (Q1 FY25).

Amid these, only four new-age tech stocks ended in the red today, falling in a range of 0.21% to 2.99%. Yudiz emerged as the biggest loser, with its shares ending the day almost 3% lower at INR 56.85 apiece on the NSE. 

TAC Infosec, Fino Payments Bank and EaseMyTrip were the other losers today. 

The broader Indian stock market recovered all losses after crashing in the previous trading session, with domestic benchmark indices Sensex and Nifty50 ending the day in the green. 

While the 30-share BSE Sensex rose 1.11% to end the day at 79,468.01, Nifty50 climbed 1.27% to close at 24,297.5.

Commenting on the market trend, Hrishikesh Yedve, assistant vice president of technical and derivatives research at Asit C. Mehta Investment Interrmediates, said, “Domestic benchmark indices began higher on Wednesday, driven by strong global sentiment. Nifty opened with a gap up and remained strong throughout the day. As a result, the Nifty concluded the day higher at 24,298. The volatility index, INDIA VIX, fell 14% to around 16.17, indicating drop in volatility.”

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The ongoing Q1 FY25 earnings season resulted in a mixed week for the listed startups under Inc42’s coverage, with stock-specific action seen in the new-age tech stocks. 

Eleven of the 25 new-age tech stocks under Inc42’s coverage gained in a range of over 3% to 17%. Zomato emerged as the top gainer this week, buoyed by its strong Q1 show. Nazara Technologies, Nykaa, and Delhivery were also among the gainers this week. 

Meanwhile, 14 listed saw a decline in their share prices, falling in a range of under 0.1% to 11.27%. IndiaMART InterMESH, MapmyIndia, ixigo, and Go Digit were among the losers this week.. 

ideaForge emerged as the biggest loser this week, with its shares plunging 11.27% to INR 735.40 over its weak Q1 numbers. The drone startup’s profit after tax (PAT) declined almost 94% to INR 1.2 Cr from INR 18.9 Cr in the year-ago quarter.

Meanwhile, the broader market plummeted in the later part of the week after moving up earlier during the week. While Sensex ended the week 0.43% lower at 80,981.95, Nifty 50 declined 0.47% this week to end at 24,717.70. 

Commenting on the market trend, Geojit Financial Services’ head of research Vinod Nair said that the market is displaying signs of fatigue at higher levels as most “positive factors have already been priced in”. Adding to this is the global economic slowdown due to escalating trade tensions, conflicts in the Middle East, and persistently high inflation.

“Going forward, the chances of further consolidation seem elevated due to premium valuations, weak Q1 results, and ongoing global market consolidation,” he said. 

Echoing his sentiment, Mehta equities’ senior VP (Research) Prashanth Tapse said that investors in domestic markets felt the impact of the global market situation and resorted to profit booking as recession fears re-emerged. 

“Despite the slump, our resilient economy and strong fundamentals, along with healthy corporate earnings, would keep the downside limited. Technically speaking, the 25,000 mark for Nifty has now become a psychological hurdle and confirmation of strength can be seen only above that level,” he said. 

In the coming week, all eyes will be on the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC), which will meet from August 6-8, Nair said. 

Amid all these, the startup IPO boom continues. Three startups – Ola Electric, Unicommerce and FirstCry – are set to list on the exchanges in the coming weeks.

Ola Electric’s IPO opened on August 2 and received 35% subscription on the first day of bidding on Friday. The EV maker has set a price band of INR 72-76 per equity share for the public issue. At the upper end of the price band, it would raise INR 6,145.6 Cr.

In its IPO note, wealth management and investment advisory Devan Choksey gave Ola Electric’s public offering a “subscribe” rating. It believes that Ola Electric’s continued focus on fostering research and development will help it extend its market share in the two-wheeler EV category. It is pertinent to note that Ola Electric is already the market leader in the segment. 

“The company prioritises R&D and plans to continue launching next-generation EVs. The company’s strategic initiatives include the development of the Ola Gigafactory and a focus on backward integration to enhance supply chain control and cost efficiency. Overall, the growth plans and cost efficiency initiatives justify the valuation,” it said.

FirstCry and Unicommerce’s public offerings are set to open on August 6 and close on August 8. While FirstCry is set to raise INR 4,193 Cr at the upper end of its price band of INR 440-465, Unicommerce’s IPO will see its shareholders sell shares worth INR 276.57 Cr. 

Overall, the total market capitalisation of the 25 new-age tech stocks under Inc42’s coverage stood at $67.91 Bn at the end of this week as against $63.27 Bn last week. 

With that said, here’s a deeper look at the performance of the top three gainers this week. 

Zomato Continues Its Winning Streak

Zomato continued its run on the profit lane in the first quarter of FY25. The company’s profit zoomed 45% on a sequential basis to INR 253 Cr in the quarter, while operating revenue jumped more than 18% to INR 4,206 Cr in Q1 FY25. 

Consequently, shares of the foodtech major touched a 52-week high of INR 278.45 in early trading hours on August 2. Its market cap also inched closer to the $30 Bn mark. The startup’s shares shed some gains as the day progressed but gained 16.88% during the week to end at INR 262.45 apiece. 

Brokerage firm Bernstein gave the company’s shares an “outperform” rating and revised its price target to INR 275 from INR 230 earlier. 

The brokerage said that Zomato is on track to display sustained growth in food delivery, poised for a strong quick commerce performance with Blinkit and a higher uptick in monthly transacting users. 

“We see Zomato as a core internet holding, and our top pick in India Internet,” the brokerage said. 

Meanwhile, JM Financial also increased its price target on the stock to INR 260 from INR 230 earlier. “Zomato continues to be one of our preferred picks in the listed Internet space as we believe it is well positioned to benefit from robust industry tailwinds for the hyperlocal delivery businesses,” it said. 

Bernstein expects Blinkit to grow over 40% year-on-year (YoY). It anticipates Blinkit’s valuation to grow 7X by FY26, primarily due to its aggressive store expansion to reach 1000 stores by FY25 an 2000 stores by 2026.

Meanwhile, Zomato also announced the launch of a new app, District (by Zomato), to scale up its going-out business.

Nykaa Rallies To A 52-Week High

Shares of the beauty ecommerce major Nykaa jumped as much as 10.4% to touch a 52-week high at INR 202 during the intraday trading on July 30 (Tuesday). However, the stock gave up some of the gains to end below the 200 mark. Despite this, the stock rose 9.33% this week.

On Tuesday, the shares saw a multifold increase in their average trading volumes. A total of 53.2 Mn shares changed hands cumulatively on the BSE and the NSE, a 14-fold rise from the stock’s average weekly volume of 3.8 Mn shares. 

While Nykaa is yet to declare its Q1 financial numbers, the startup expects a strong revenue growth of around 22-23% YoY. 

“Our beauty vertical’s revenue growth for the quarter is expected to be around 22-23% YoY, similar to the consolidated entity’s revenue growth. GMV growth is expected to be higher, in the high twenties YoY, in line with long-term BPC (Beauty & Personal Care) industry growth trajectory,” the startup said in July.

On its investor day in June, Nykaa said that it is aiming to achieve a mid-single-digit EBITDA margin by FY27 and then increase it to 10%. It also expects its BPC business to grow at a CAGR of mid-to-late 20% till FY28. 

Post this disclosure, JM Financial raised its price target on Nykaa to INR 230 from INR 220 earlier. ICICI Securities also upgraded the stock to ‘add’ from ‘hold’ and raised the target to INR 195 from INR 175 earlier.

Fino Payments Bank Gains On Uptick In Q1 Numbers

The Rishi Gupta-led payments bank emerged as the second biggest gainer this week as markets reacted positively to its Q1 performance. Fino’s shares ended the week 12.24% higher at INR 336.80.

The payments bank posted a PAT of INR 24.27 Cr in Q1, up 29.7% from INR 18.7 Cr in the year-ago quarter. Revenue from operations grew 25.4% YoY to INR 436.86 Cr in Q1. 

In the quarter, Fino said that over 68,000 new digital accounts were opened on its platform which facilitated 57 Cr UPI transactions. Besides, the payments bank also saw its merchant network rise 25% YoY to 18.1 Lakh. 

Moving forward, the company is looking to enhance its focus on digital payment services. “Our new vertical ‘digital payment services’ is growing on a profitable basis and giving the necessary impetus to our TAM (transaction, acquisition and monetisation) strategy,” CEO and MD Gupta said. 

The current account savings account (CASA) segment contributed INR 93.6 Cr to Fino’s net income in Q1 FY25.

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In a week in which finance minister Nirmala Sitharaman presented the first Union Budget of Modi government 3.0, new-age tech stocks rallied in line with the broader market and stock-specific developments.

Twenty one out of the 24 stocks under Inc42’s coverage ended the week with gains in the range of 0.26% to almost 11%. Shares of Paytm breached the INR 500 mark after a long time and the stock emerged as the biggest gainer this week with a 10.93% jump. Nykaa, Zomato and Mamaearth also rose this week.

Traveltech startups EaseMyTrip, Yatra, and ixigo gained this week after the finance minister announced a slew of initiatives in her budget speech to boost tourism.

The government announced support plans for comprehensive development of Vishnupad Temple Corridor and Mahabodhi Temple Corridor to boost the spiritual tourism sector. The finance minister allocated INR 2,479.62 Cr for the tourism sector for FY25, up 46% from the revised allocation of INR 1,692.10 Cr in FY24. 

Shares of geotech company MapMyIndia also soared over 5% this week as Sitharaman announced plans to digitise land records in urban India with GIS mapping.

Only three new-age tech stocks ended in the red this week – Awfis, TAC Infosec, and Yudiz, declining in a range of 0.8% to about 3%.

Meanwhile, the broader market continued its upward momentum this week. Sensex gained 0.9% to end at 81,332.72, while Nifty 50 rose 1.2% this week to end at 24,834.85.   

Commenting on the market performance this week, Geojit Financial Services’ head of research Vinod Nair said that the budget was both populist and prudent, and failed to spark any significant excitement in the market.

“The market has now recovered its losses from budget day, driven by positive US GDP data and expectations of improved global demand. Moving forward, the direction of the domestic market will likely be influenced by the progress of the earnings season,” he said.

Meanwhile, Prashanth Tapse, senior VP of research at Mehta Equities, said that Indian markets outperformed the global peers this week on the back of a strong buying support across the board. He attributed this resilience to the strong growth of the Indian economy and better-than-expected earnings reports of blue chip and mid-cap companies.

Amid the startup IPO rush, Jaipur-based D2C men’s grooming brand Menhood made iCts public market debut on the NSE Emerge this week and became the latest stock under Inc42’s coverage.

Overall, the total market capitalisation of the 25 new-age tech stocks under Inc42’s coverage stood at $63.27 Bn at the end of this week. The valuation of 24 new-age stocks stood at $60.99 Bn last week. 

Now, let’s take a deeper look at the performance of some of the listed new-age tech stocks this week. 

Paytm Gets Long-Pending Approval 

Shares of Paytm surged nearly 11% this week to cross the INR 500 mark after the company received the long-pending approval from the government to invest INR 50 Cr in its payments arm, Paytm Payment Services.

The stock surged 10% on Friday (July 26) after it was reported that the Vijay Shekhar Sharma-led company has secured the investment approval, which would allow it to apply for an online payment aggregator (PA) licence.

It is pertinent to note that Paytm reported an underwhelming financial performance in the first quarter of the fiscal year 2024-25 (Q1 FY25), with its net loss widening 134% year-on-year to INR 840.1 Cr.

Paytm was in the news this week for a number of other reasons: 

• Brokerage firms Emkay Global, JM Financial, and Motilal Oswal retained their “reduce”, “sell”, and “neutral” ratings on the stock, respectively, following the declaration of Q1 results.
• Paytm joined hands with Axis Bank to offer point of sale solutions and card payment machines to its merchant network on July 23.
• Paytm received a fine of INR 250 for failure to pay stamp duties pertaining to the allotment of ESOP granted by the company. Moreover, an additional penalty of INR 370 has been imposed for similar non-compliance.

Commenting on the stock’s performance, Amol Athawale, VP of technical research at Kotak Securities, said, “We maintain a neutral stance on Paytm, viewing the recent movement as a potential pullback or technical rebound. We anticipate short-term bullish trends to persist. It is difficult to predict in the long term as there’s been too much volatility in the stock.” 

Go Digit Posts Robust Q1 Numbers 

Insurtech unicorn Go Digit this week reported a 74% increase in its profit after tax (PAT) to INR 101 Cr in Q1 FY25 from INR 58 Cr in the year-ago quarter. Its net earned premium also rose to INR 1,824 Cr during the period under review from INR 1,475 Cr in the year-ago quarter. 

Following the disclosure of Q1 numbers on June 25, the stock rallied over 8% to touch INR 362.25 apiece during the intraday trading session on the BSE on June 26. Overall, Go Digit rose 0.26% this week to end at INR 345.45. 

Athawale said that Go Digit’s immediate resistance level is INR 370 and support for the stock is seen at INR 335. He added that the stock would see a strong rally if it breaches INR 375 mark, while it can come down to INR 310-315 on the lower level.

Menhood Makes A Strong Debut

D2C brand Menhood parent Macobs Technologies became the third new-age entity to list on NSE Emerge this week, after TAC Infosec and Trust Fintech.

Menhood’s IPO was oversubscribed 157.5X, with investors bidding for 40.89 Cr shares as against 25.95 Lakh shares on offer.

The D2C brand got listed at INR 96 apiece, a 28% premium to its issue price of INR 75. Since its listing on Wednesday, the startup’s share prices have spiked 9.84% to end the week at INR 105.45.

It filed its draft red herring prospectus (DRHP) in January 2024. Its IPO comprised a fresh issue of 25,95,200 equity shares of INR 10 each. 

Founded in 2019 by Dushyant Gandotra, Menhood offers a wide range of products in the male grooming and lifestyle segment, such as trimmers, intimate perfumes, intimate wash and moisturisers.

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A majority of new-age tech stocks were trading in green today (July 24), signalling buoyed investor sentiment, a day after startups got a shot in arm with the government scrapping angel tax in the Union Budget 2024-25. 

At least nineteen out of 24 new-age tech stocks under Inc42’s coverage jumped intraday on the BSE in the range of 0.98% to 7.1%, with Zaggle emerging as the biggest winner.

Shares of Zaggle opened today’s trading session at INR 306, up over 2% from the previous close. The stock jumped 7.1% intraday at INR 322.90 per share and was trading 5.32% higher at INR 315.80 apiece on the BSE at 1:28 PM.

CarTrade, Awfis, ixigo and Nazara were among other gainers.

Meanwhile, the remaining new-age tech stocks being tracked by Inc42 fell in the range of 1.13% to 2.78%, with MapmyIndia emerging as the biggest loser, with shares trading at INR 2,405.90 apiece on the BSE at 1:35 PM, down 2% from the previous close.

Paytm, RateGain and Mamaearth were among the other laggards during the day.

Data for shares of Yudiz was not available on the NSE at the time of publishing this article.

In her Budget speech, Union finance minister Nirmala Sitharaman made several announcements for the startup ecosystem, with one being that land records in urban areas will be digitised with GIS mapping.

The finance minister also announced a 46% increase in budgetary allocations for the tourism sector for the fiscal year 2024-25 (FY25), giving further push to travel  tech startups.

Moreover, the government has cut down TDS rates for ecommerce operators to 0.1% from 1% earlier.

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Most of the Indian new-age tech stocks declined this week amid the ongoing earnings season and a global IT outage, despite the broader market seeing a slight uptick.

Twenty one out of the 24 new-age tech stocks under Inc42’s coverage fell this week in a range of 0.28% to just under 12%. Cybersecurity startup TAC infosec emerged as the biggest loser, with its shares dropping 11.99% to end the week at INR 527.95. 

Nazara, Paytm, Zomato, and Nykaa were among the losers this week.

Meanwhile, only three stocks – Awfis, Yudiz and Go Digit – gained this week. Continuing its bull run from last week, coworking startup Awfis emerged as the biggest gainer (up 452%) this week. 

It is pertinent to note that markets remained closed on Wednesday (July 17).

Meanwhile the broader market maintained its upward momentum this week. However, Nifty 50 and Sensex fell nearly 1% each after a global IT outage created by a cybersecurity-related mishap at big tech Microsoft. Overall, Sensex and Nifty 50 gained 0.1% this week to end at 80,604.65 and 24,530.90, respectively.  

The IT outage barred users from accessing various Microsoft 365 apps and services, impacting businesses across industries globally. In India, airtravel, brokerages and some financial institutions were impacted. 

Commenting on the market performance this week, Mehta Equities’ senior VP (research) Prashanth Tapse said investors began profit booking on Friday amid the news of disruptions across industries. 

“IT stocks, which held ground in early trades, too gave up their gains, while other sectoral and broader indices incurred substantial losses after sentiment turned extremely bearish on weak global cues and reports of online businesses in several countries, including in India, hit by cyber outages,” Tapse said. 

Analysts expect stock-specific actions in the coming weeks as the earning season picks up pace. 

Reliance Industries, Paytm, and Justdial were among the companies which reported their Q1 FY25 numbers this week. Shares of Justdial surged nearly 24% this week after the company posted a 69% year-on-year increase in net profit to INR 141.22 Cr in the quarter ended June 30, 2024.

Next week, all eyes will be on finance minister Nirmala Sitharaman as she presents the Union Budget on July 23. Motilal Oswal Financial Services’ retail research head Siddhartha Khemka said that the Budget announcements will set the direction for the market for the coming weeks. 

“Investors are anticipating pro-industry and populist measures with prudence on fiscal matters. If the Budget meets the expectations, it will provide more stability in the market,” he added. 

Overall, the total market capitalisation of the 24 new-age tech stocks under Inc42’s coverage stood at $60.99 Bn at the end of this week as against $63.02 Bn last week. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks.

Paytm’s Promising Commentary 

Hit by the Reserve Bank of India’s (RBI’s) regulatory action, fintech major Paytm reported another quarter of weak earnings. Its net loss stood at INR 840.1 Cr in the June quarter, a 134% jump from INR 358.4 Cr in the year-ago period. Operating revenue also declined 36% to INR 1,502 Cr.  

However, the Vijay Shekhar Sharma-led startup said it anticipates enhanced revenue and profitability in the future. The company cited the revival of its merchant payment business, expansion of its loan cross-selling vertical, and robust product-market fit in its shop insurance vertical as key drivers for this growth.

These projections were well received by the bourses as the company’s shares surged 6% to INR 472.15 during the intraday trading session on the BSE on Friday. Despite this, the stock ended the week 1.83% lower, breaking the upward momentum of two weeks.

Paytm also informed that it received a show cause notice from market regulator SEBI in relation to a grant of 2.1 Cr employee stock options (ESOP) to CEO Sharma.

The company also received an administrative warning letter from SEBI over related party transactions conducted by the company with Paytm Payments Bank in FY22. 

Mixed Week For Zomato

Continuing last week’s bull run, foodtech major Zomato’s shares surged as high as INR 232 during the intraday trading on Monday. However, the stock lost steam later to end the week 1.64% lower at INR 218.80 on the BSE. 

Zomato was in the news for multiple new developments this week:

• The foodtech major, along with its archrival Swiggy, hiked platform fees to INR 6 per order in key markets, including Delhi and Bengaluru, on July 15. 
• Multiple states are mulling pilot projects for home delivery of liquor via online platforms, such as Zomato, Zomato-owned Blinkit, Swiggy and BigBasked. 
• Motilal Oswal Mutual Fund sold 2.8 Cr shares of Zomato in a block deal worth INR 645.8 Cr this week. 

All eyes will now be on Zomato’s Q1 FY25 numbers. The company is yet to declare the date for the results announcement. 

Kotak Institutional Equities anticipates that Zomato will reveal robust results for Q1 FY25, driven by a 23% YoY growth in food delivery gross merchandise value (GMV) and an impressive 113% YoY growth in Blinkit’s GMV.

Nuvama projects Zomato’s revenue to increase 11.5% quarter-on-quarter (QoQ) and an impressive 64.4% YoY. Adjusted revenue from the food delivery segment is anticipated to grow 5.3% QoQ and 23.9% YoY, while Blinkit is forecasted to grow 29% QoQ.

JM Financial, also said in a recent research note, that it expects Zomato to report a very strong quarter sequentially for its food delivery and quick commerce businesses in Q1 FY25.

Awfis Continues Its Bull Run

Despite the broader bearish trend in new-age tech stocks, Awfis continued its winning run this week. The stock hit the 20% upper circuit on Thursday during the intraday trading on the BSE, reaching a new 52-week high of INR 757.20.

While the stock plunged 7.63% on Friday, Awfis ended the week 4.52% higher at INR 647.20. 

The startup’s shares have gained about 50% since its listing in May.

Recently, Awfis managing director and chairman Amit Ramani told Inc42 that the startup is expected to surpass the INR 1,100 Cr revenue mark in FY25. Additionally, it aims to expand its operational seats by approximately 50%, reaching a total of 1,35,000 seats by the end of the year. 

Awfis achieved profitability in Q4 FY24, reporting a profit after tax (PAT) of INR 1.4 Cr on an operating revenue of INR 232.3 Cr.

The post New-Age Tech Stocks Tank Ahead Of Union Budget, Awfis Biggest Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks experienced a mixed week as investors await the upcoming Union Budget and earnings for the first quarter of the ongoing fiscal year 2024-25 (Q1 FY25). 

Analysts expect stock-specific actions in the coming week amid the ongoing earnings season. 

Ten out of the 24 new-age tech stocks under Inc42’s coverage gained this week in a range of 1% to a little over 12%. Recently-listed coworking startup Awfis emerged as the biggest gainer, with its shares zooming over 12%. 

Earlier in the week, shares of Awfis touched a record high of INR 635 during intraday trading on July 11. TAC Infosec trailed Awfis, with its shares rising 8.78% this week.  

Paytm and Zomato also saw a healthy uptrend this week, with shares of both the companies gaining over 7% each. Paytm is scheduled to declare its financial results for Q1 FY25 on July 19. Nykaa, PB Fintech, and ixigo were among the other gainers this week.

On the other hand, 14 startups, including last week’s top gainer Honasa, MapmyIndia, Go Digit, and TBO Tek, were among the losers this week. Their shares fell in the range of 0.02% to over 8%. Blockchain and IT development startup Yudiz emerged as the biggest loser this week. 

Amid all these, the ongoing IPO boom continued. On July 7, logistics unicorn BlackBuck filed its IPO papers with the Securities and Exchange Board of India (SEBI). The startup is looking to raise INR 550 Cr via fresh issue of shares. Besides, the IPO of D2C men’s grooming brand Menhood is scheduled to open on July 16. The startup’s IPO will comprise a fresh issue of 25,95,200 equity shares of face value of INR 10 each. It is expected to raise INR 19.5 Cr via its IPO.

Meanwhile, the broader market maintained its bullish momentum this week. Sensex gained 0.6% to end the week at 80,519.34, while Nifty50 rose 0.7% this week to end Friday’s session at 24,502.15.

Commenting on the market’s performance this week, Geojit Financial Services’ head of research Vinod Nair said that while investors are cautious about the earnings session, there are also expectations of the government presenting a growth-oriented Budget.

Meanwhile, Emkay Wealth Management’s head of research Dr Joseph Thomas said, “Markets trended higher towards the close of the week as the earnings season kicked off on a positive note and inflation numbers in the US were better than expected. The current phase of volatility cannot be ruled out as profit booking may continue ahead of the Budget, which will provide more clarity on policy continuity.” 

Finance minister Nirmala Sitharaman is scheduled to present the Union Budget 2024-25 on July 23. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week. 

Overall, the total market capitalisation of the 24 new-age tech stocks under Inc42’s coverage stood at $63.02 Bn at the end of this week. 

Paytm Shows Signs Of Recovery 

Shares of Paytm ended the week, which was filled with multiple developments for the company, 7.2% higher at INR 467.25. 

While shares of Paytm have been under pressure since February this year, following the Reserve Bank of India’s (RBI) curbs on Paytm Payments Bank Ltd (PPBL), the stock has been seeing an uptrend since last month.

The company was also in the news for multiple reasons this week. Let’s take a look:

• On July 8, the fintech major expanded its employee stock option plan (ESOP) pool by allocating 2,81,394 shares to its employees. 
• A government panel which approves investment from neighbouring countries has reportedly cleared Paytm’s proposed investment in Paytm Payment Services. Final clearance on this issue will pave the way for the Paytm subsidiary to apply for an online payment aggregator (PA) licence to the RBI.
• The drama between Paytm and its recently fired employees escalated, with the labour ministry summoning the fintech major earlier this week. Post this, the startup agreed to not recover the joining bonus from an aggrieved employee.
• Paytm saw a marginal increase in the shareholding of domestic mutual funds and Indian retail investors in Q1 FY25. Meanwhile, ownership of FIIs and foreign portfolio investors in the company went down.

All eyes will now be on Paytm’s Q1 numbers, scheduled to be declared on Friday (July 19).  In its last disclosed financial results for Q4 FY24, Paytm’s loss more than tripled to INR 550.5 Cr from INR 167.5 Cr in the year-ago period. Revenue from operations also declined 2.9% to INR 2,267.10 Cr during the quarter from INR 2,334 Cr in Q4 FY23. 

However, CEO and founder Vijay Shekhar Sharma recently reiterated his optimism about the company’s future and said his vision is to turn Paytm into a $100 Bn company. 

Zomato Extends Its Bull Run

Continuing its bull run, the foodtech major’s shares touched a fresh all-time high of INR 223.40 during the intraday trading on July 12. The stock has jumped nearly 170% in the last one year.

Recently, Zomato received its shareholders’ approval to create a new employee stock option pool of 18.26 Cr shares.

However, earlier this week, JM Financial cut Zomato’s price target to INR 230 from INR 250 previously. Giving its reasoning, the brokerage said that ESOP grants should be linked to measurable performance-based outcomes, which is not the case with Zomato’s newly laid-out policy.

“There is a risk of the new ESOP policy being considered unfair by some shareholders as they would be the ones taking a meaningful hit on their earnings in the medium term”, said JM Financial analysts.

Awfis Soars To An All-Time High

While investor interest has been bullish on the coworking space provider startup since its listing on the bourses in May, the company’s shares touched an all-time high of INR 635 during the intraday trading on July 11.

The stock has gained 43% on the BSE since its listing on May 30. 

Recently, Awfis managing director and chairman Amit Ramani told Inc42 that the startup’s top line is expected to breach the INR 1,100 Cr mark in FY25. The company is also looking to expand its portfolio by about 50%, reaching a total of 1,35,000 operational seats by the end of the year. 

Awfis turned profitable in Q4 FY24, posting a profit after tax (PAT) of INR 1.4 Cr on an operating revenue of INR 232.3 Cr.

The post Awfis, Zomato Touch All-Time High Mark Amid A Mixed Week For New-Age Tech Stocks appeared first on Inc42 Media.

Indian new-age tech stocks rallied significantly this week as the broader market continued the upward momentum, helped by positive domestic and global cues.

Twenty one out of the 24 new-age tech stocks under Inc42’s coverage gained during the week in a range of 0.4% to over 11% on the BSE. 

D2C beauty brand Mamaearth emerged as the biggest winner this week, with its shares surging 11.1%. It was followed by Tracxn Technologies, which jumped 9.8%.

Shares of recently-listed ixigo also zoomed 8.7% on the back of its strong FY24 earnings. Shares of Paytm, TAC Infosec, and CarTrade also surged over 8%.

MapmyIndia, Awfis, RateGain, ideaForge, and Nazara Technologies were among the other gainers.

However, shares of Delhivery fell about 1.1% this week after the announcement of it expanding its ESOP pool.

Meanwhile, PB Fintech and TBO Tek declined 1.1% and 3.2% on the BSE, respectively, after being the top two gainers last week. 

In the broader market, benchmark indices Sensex and Nifty50 gained 1.22% and 1.3%, respectively. However, Sensex ended marginally lower at 79,996.6 on Friday while Nifty50 closed marginally higher at 24,323.85.

Vinod Nair, head of research at Geojit Financial Services, said that the domestic market maintained its upward momentum on the advancement of monsoon and anticipation of the upcoming Union Budget. 

Besides, a reduction in US personal consumption expenditure inflation has also raised hopes for a Fed rate cut in September, he said.

“As the market enters the earnings season, starting with IT bellwether TCS, expectations are for better results. Investors will closely watch management commentary for insights into the sector’s outlook. Overall, Q1 expectations remain subdued. However, recent high-frequency economic indicators, the RBI’s upgrade for FY25 GDP target to 7.2% from 7%, with a Q1 forecast of 7.3%, and easing global inflation reduce the likelihood of weak corporate results,” Nair added. 

It is pertinent to note that the Budget session of the Parliament will commence on July 22, with the first Union Budget of the Narendra Modi government’s third term to be presented on July 23.

Meanwhile, Siddhartha Khemka, head of retail research at Motilal Oswal, sees the market consolidating at a higher zone after gaining nearly 7% in the last month. In the coming week, more stock and sector-specific actions are expected as the market starts taking cues from Q1 FY25 earnings, he added.

Overall, the 24 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $59.85 Bn versus $58.42 Bn last week.

ixigo’s First Earnings Report After Listing 

After its stellar debut on the Indian bourses last month, ixigo posted its March quarter and FY24 earnings results on Thursday (July 4).

While its net profit more than tripled year-on-year (YoY) to INR 73.1 Cr during the year, operating revenue increased almost 31% to INR 655.9 Cr.

Shares of ixigo rose 4.8% on Thursday ahead of the result announcement. The shares jumped over 7% during the intraday trading on the BSE on Friday but ended the week’s last trading session about 4% higher at INR 170.45.

Speaking on the stock’s performance, Prashanth Tapse, senior VP, research analyst at Mehta Equities, said that following the rise in the share price post its listing, the valuations seem overstretched currently. 

“Given ixigo’s strong presence in rail bookings and a significant market share through ixigo and ConfirmTkt, the company is well-positioned in the rapidly growing travel sector. Hence, only risk-taking investors can continue to hold on to risk for a long-term perspective, while conservative investors should wait and watch for any dips to enter,” he added.

ixigo’s current market cap stands at INR 6,603.63 Cr as against INR 6,275.87 Cr on the listing day. 

Meanwhile, Riyank Arora, technical analyst at Mehta Equities, said that the stock is trading below its immediate resistance level of INR 177.5 and above the major support level of INR 150. A move above INR 177.5 is likely to generate momentum, pushing the rally towards INR 197.5 and then INR 225. 

“Traders and investors should consider buying on dips around INR 165-INR 167 with a firm stop loss at INR 150,” Arora added.

Paytm Regains Some Momentum

Shares of Paytm jumped 8.5% this week to end the last trading session at INR 436.6 on the BSE. 

Amid significant volatility, Paytm has largely been trading sideways. However, it managed to close above the INR 430 level this week, the highest since the beginning of February this year, when the stock traded above the INR 440 level.

However, the shares are still trading 43% lower than the INR 760 level last seen at the end of January this year, just before the RBI’s clampdown on Paytm Payments Bank.

This week, the shares gained some momentum on the back of a few developments in the company. Earlier this week, Paytm rolled out a new health and protection plan, ‘Paytm Health Saathi’, for its merchant partners to facilitate them with affordable and comprehensive healthcare benefits.

Meanwhile, a report said that Paytm Payments Bank Ltd is at odds with its auditor JC Bhalla & Co. over the certification of its FY24 accounts.

Over the last one month, Paytm shares have gained over 28% on the BSE.

Zomato Touches A Record-High 

Shares of Zomato saw a strong uptrend earlier this week but lost some gains in the latter half. Overall, the stock gained 3.6% to end the last trading session at INR 207.5 on the BSE.

The shares touched a new record high at INR 213.8 on Wednesday (July 3). This also came amid multiple business developments in the company.

In The News For:

• Zomato received shareholders’ approval to create a new employee stock option pool of 18.26 Cr shares earlier this week.
• The foodtech major’s home-cooked meal service ‘Zomato Everyday’ has been expanded to Mumbai.
• Months after launch, Zomato suspended its logistics business ‘Xtreme’ due to poor demand.
• The startup has brought back two senior executives to ramp up its Going-Out business amid its discussions with Paytm to acquire its movie ticketing and events verticals.

Though the company received a new goods and service tax (GST) demand notice of INR 9.45 Cr from the Assistant Commissioner of Commercial Taxes (Audit) in Karnataka, the news development failed to show any major impact on the stock this week.

Meanwhile, reiterating its ‘buy’ rating on the stock and a fair value of INR 225, Kotak Institutional Equities, said in a new research report that it expects Zomato to report healthy Q1 FY25 results, driven by 23% YoY growth in food delivery GMV and 113% YoY growth in Blinkit GMV. 

“We expect both businesses to report sequential CM (contribution margin) improvement, driven by better take rate (higher platform fee in food delivery) and advertising income (in Blinkit),” the brokerage added.

The post New-Age Tech Stocks Gain This Week On Broader Market Rally, Mamaearth Biggest Gainer appeared first on Inc42 Media.

Indian new-age tech stocks witnessed a mixed week, with major block deals pulling down some of them, despite the broader domestic market continuing its rally. Analysts believe that investors are currently following the ‘buy on dips’ strategy in the Indian equity markets.

Ten out of the 24 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.03% to almost 20% on the BSE. 

TBO Tek emerged as the top gainer, with its shares surging 19.8% during the week after Goldman Sachs initiated coverage on it with a ‘buy’ rating and projected a meaningful upside. The shares touched an all-time high at INR 1,938.75 but ended the week at INR 1,903.2, only 3.5% lower than Goldman Sachs’ price target for the stock.

PB Fintech was the second-biggest winner this week, with its shares gaining 4.6% on the BSE. It was followed by Awfis, which gained 4.2%.

Zomato, Nykaa, IndiaMART, ideaForge, Go Digit, Delhivery, and Nazara were the other gainers this week.

On the other hand, TAC Infosec emerged as the biggest loser, as its shares nosedived 13.7%. It was followed by Fino Payments Bank, which fell 11.3%.

Yudiz, ixigo, CarTrade, MapmyIndia, Mamaearth, and RateGain were among the total of 14 new-age tech stocks that declined this week.

Among these, CarTrade saw some major block deals this week as some of its top investors – Highdell Investment, MacRitchie Investments, and JP Morgan’s CMDB II – offloaded shares worth over INR 535 Cr.

MapmyIndia shares also declined amid a block deal initiation announcement by the company’s promoter and founder.

In the broader market, benchmark indices Sensex and Nifty50 gained 2.4% and 2.2%, respectively. After touching fresh all-time highs on Friday (June 28), Sensex ended the week at 79,032.73 and Nifty 50 closed at 24,010.60. 

Speaking about the market sentiment, V K Vijayakumar, chief investment strategist at Geojit Financial Services, said earlier this week that high valuations might prompt selling by foreign institutional investors (FIIs) and profit booking by domestic institutional investors (DIIs), but the exuberant retail investors are likely to buy every dip since the ‘buy on dip strategy’ has worked well in this bull market.

On Friday, Vijayakumar said, “The market momentum has the potential to take the Sensex to 80,000 levels. The healthy trend in the recent rally is that it is driven by fundamentally strong large caps. However, corrections can happen any time since the market is in the overbought zone and DIIs are booking profits.” 

“The elevated valuations in the market continue to be a concern but the market is not yet in bubble valuation territory,” he added.

Meanwhile, the trend of FIIs selling their holdings has also started seeing some reversals.

Siddhartha Khemka, senior group VP, head of research at broking and distribution at Motilal Oswal, expects the positive momentum that the market saw this week to continue at a steady pace with stock-specific action. 

“However, the release of economic data points next week would keep a little volatility in the market,” Khemka added.

Overall, the 24 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $58.42 Bn.

Now, let’s take a deeper look at the performance of the new-age tech stocks in the market.

MapmyIndia Promoter To Pare Stake

Shares of MapmyIndia, which ended last week at a historical highest close of INR 2,532.7, fell 9.12% this week after its promoter and founder Rakesh Verma announced selling 5 Lakh shares of the geotech company in a block deal.

The company said that Verma was selling a part of his stake for philanthropy. However, the shares declined in two consecutive sessions mid-week. The stock ended Friday’s session 2.6% higher at INR 2,301.8 on the BSE.

It is also pertinent to note that brokerage JM Financial started its coverage on MapmyIndia with a ‘buy’ rating and a price target (PT) of INR 2,900, which implies an upside of almost 26% to the stock’s last close.

The brokerage said that its constructive view on the stock is based on a few top-down rationales, including location intelligence as a service (LaaS) becoming ubiquitous across industries and the company’s well-established moats to not only ride the rising adoption trend but also gain market share.

Speaking on MapmyIndia’s performance, Jigar S Patel, senior manager of technical research analyst at Anand Rathi, said that the stock’s support is at INR 2,200.

“Investors can use ‘buy on dips’ strategy for the next week,” said Patel, adding that the trading range is expected to remain between INR 2,200 and INR 2,450 in the near term.

Nazara’s Business Expansion Continue

After a slightly slow start to the week, shares of Nazara jumped almost 7% during Friday’s trading session, ending the week at INR 868.95 on the BSE.

The rally took place after Nazara’s esports subsidiary NODWIN Gaming announced increasing its existing 13.51% stake in Germany-based Freaks 4U Gaming GmbH to 100% in tranches through a share swap valued at INR 271 Cr.

Besides, earlier this week, Nazara’s publishing arm, Nazara Publishing, also entered into a publishing partnership with nCore to publish ‘Made in India’ mobile game FAU-G Domination. The pre-registration of the game will open on Google Play and the App Store later this year.

Overall, the gains for the week were marginal.

It is pertinent to note that after witnessing a sharp slump from the beginning of the year till May, shares of Nazara have witnessed a significant rally over the last one month and have jumped over 41% so far since May 27, after the company published its FY24 earnings.

Anand Rathi’s Patel said that the upside for the stock is seen till INR 935-INR 940, while the support is at INR 800 zone. 

Brokerages More Bullish On Zomato After Swiggy’s 2023 Performance Update

After Prosus published IPO-bound Swiggy’s 2023 operating performance, multiple Indian and international brokerages turned more bullish on Zomato’s market share and performance in food delivery.

For instance, Goldman Sachs said that Zomato now likely holds a 56-57% market share in the food delivery market.

It is to be noted Zomato’s biggest competitor in the food delivery market, Swiggy saw a 26% year-on-year (YoY) increase in gross order value (GOV) in 2023. Its core food-delivery business GOV grew by “double digits”, as per Prosus’ disclosure.

“At a 31% FY24-27 GOV CAGR, Zomato is the fastest growing food delivery company within our global coverage and also one with the highest margin profile,” Goldman Sachs said.

Meanwhile, JM Financial also said in a research note that while Swiggy confidentially filed its pre-DRHP with the SEBI earlier this year, a successful public listing of the company largely hinges on the management’s ability to arrest market share losses in both food delivery and quick commerce businesses. Besides, they will also have to demonstrate a clear path to adjusted EBITDA break-even at a consolidated level for the company.

Emkay, CLSA, and Kotak Institutional Equities also reiterated their ‘buy’ rating on Zomato, with most of them highlighting that the company’s growth is faster than Swiggy’s.

Following the brokerages’ bullish stance, shares of Zomato ended above INR 202 level on Tuesday (June 25) for the first time. However, the stock ended the week at INR 200.35, gaining 3.22% overall during the week.

Anand Rathi’s Patel said INR 205 is a crucial resistance level for the stock. A further upside is possible only above this level, he said, adding that the support is at INR 90.

The post TBO Tek Emerges The Top Gainer In A Mixed Week For New-Age Tech Stocks appeared first on Inc42 Media.

Riding on the back of the rally in the broader market following the return of the NDA government to power, Indian new-age tech stocks witnessed yet another week of gains.

Fifteen of the 23 new-age tech stocks under Inc42’s coverage gained in a range of 0.05% to about 29% this week. MapmyIndia emerged as the biggest gainer this week, with its shares surging 28.89%.

Fino Payments Bank (16.68%), Tracxn (10.47%), Yudiz (5.76%), Zomato (4.24%), and Nykaa (1.52%) were among the other winners this week.

Coworking space provider Awfis reported its first financial results this week since its listing on the exchanges. The startup turned profitable in the fourth quarter of the financial year 2023-24 (FY24), posting a consolidated profit of INR 1.4 Cr. Following this, the stock jumped 9% to INR 543.70 during the intraday trading on Thursday. Eventually, Awfis ended the week 0.92% higher.

On the other hand, DroneAcharya Aerial Innovations emerged as the biggest loser this week. Its shares ended 3.79% lower at INR 149.60 on Friday. 

Among the other losers this week were Paytm (3.20%), PB Fintech (2.81%), and Delhivery (1.91%). 

Meanwhile, this week, online travel aggregator ixigo became the latest new-age tech startup to go public, becoming the 24th stock under Inc42’s coverage.

The startup’s shares were listed at INR 138.10 per share on the NSE, a premium of 48.5% from the issue price of INR 93. Similarly on the BSE, the shares opened at INR 135 apiece, up 45.16% from the issue price.

Following the listing, shares of ixigo continued to gain and ended the week over 25% higher from the listing price at INR 169.18 on the BSE.

In the broader market, benchmark indices Sensex and Nifty50 gained 0.28% and 0.15%, respectively. While Sensex ended the week at 77,209.90, Nifty 50 closed at 23,501.10. 

It is pertinent to note that the stock exchanges were closed on Monday (June 17) on the occasion of Bakri Id. 

Commenting on the market performance, Geojit Financial Services’ research head Vinod Nair said, “With a coalition government in place, there is optimism that the upcoming Budget will strike a balance between growth initiatives and populist measures. Additionally, expectations are high for government actions aimed at stimulating consumption, a critical area to focus on.” 

 Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week.

Overall, the 24 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $54.95 Bn as against 23 stocks ending the last week with a valuation of around $54.94 Bn.

Zomato Gains On Paytm Insider Acquisition Bid

On Sunday (June 16), foodtech major Zomato and fintech Paytm intimated the bourses that they were in discussions for the former to acquire the latter’s events and movie ticketing business, Paytm Insider.

While the companies only said that the discussions were at a preliminary stage, reports pegged the deal size at around INR 1,500 Cr. 

If it materialises, the deal can shore up Zomato’s revenue by bolstering its ticketing and entertainment segment revenue. It will also position the foodtech company as a challenger to BookMyShow.

Buoyed by the acquisition talks, shares of Zomato jumped 4.24% to end the week at INR 194.10 on the BSE. 

Meanwhile, brokerages continue to be bullish on the stock. In a research report this week, JM Financial retained its ‘Buy’ rating for the stock but reduced its price target (PT) for the stock to INR 250, from April’s INR 260. It said that acquisition of Paytm’s ticketing business will strengthen Zomato’s ‘Going-out’ business, 

“The deal could catapult Zomato to second position in the events & movie ticketing space, behind only BookMyShow,” the brokerage added. 

Meanwhile, Bernstein also maintained its ‘Buy’ rating on the stock, along with a PT of INR 230. 

“Zomato is a market leader in key segments it operates in, driven by its solid execution in selected under-penetrated end markets. Going forward, we believe quick commerce which has shown exponential growth — growing over 100% YoY in 2023, will be the most attractive segment from a growth and margin perspective,” Bernstein said in a report.

Paytm Loses Steam 

The fintech giant ended its three-week winning streak, with the stock falling 3.2% this week. The company was in the news for a number of different reasons this week.

• Amidst ongoing layoffs, several ex-Paytm employees have complained to the Ministry of Labour and Employment, alleging “unlawful termination” without compensation. The ex-employees have sought the reinstatement of their employment, alleging unfair and unethical termination by the Paytm management.
• Adding to the top level churn at the company, Paytm’s non-executive independent director Neeraj Arora resigned this week. The company replaced him with former Securities and Exchange Board of India’s (SEBI) whole time member Rajeev Krishnamuralilal Agarwal.
• The series of block deals continued at Paytm this week, with Goldman Sachs (Singapore) PTE selling shares worth INR 183 Cr and Marshall Wace Investment Strategies – Eureka Fund offloading shares worth INR 25 Cr.

While JM Financial remains bullish on Zomato, it gave a ‘Sell’ rating and a price target of INR 300 for Paytm. 

On the potential deal with Zomato, JM Financial’s BFSI analyst Sameer Bhise said that it is in line with Paytm’s stated strategy of focussing on the payments and financial services business.

“Incrementally, cash realisation from this sale should aid Paytm as it reenergises its marketing spends,” he said. 

MapmyIndia Soars To All-Time High

The geotech company’s shares soared to an all-time high of INR 2,745.05 on June 21. Eventually, the stock ended the week nearly 29% higher at INR 2,532.7 on the BSE. 

The sharp rise came on the back of Goldman Sachs initiating its coverage on the stock with a ‘buy’ rating and a price tag of INR 2,800. 

The brokerage highlighted MapmyIndia’s advantageous early market position in high-growth sectors such as automotive navigation, mapping devices, connected vehicles, telematics, and government digitisation.  It also forecasted a CAGR of 38% in the FY24-FY27 period, with a steady EBITDA margin in the 38% to 41% range.

The company reported a 35% increase in its consolidated profit after tax (PAT) in the March quarter of FY24 to INR 38.2 C from INR 28.3 Cr in the same quarter a year ago. Operating revenue grew 47.5% to INR 106.9 Cr from INR 72.4 Cr in Q4 FY23.

The post New-Age Tech Stocks Continue Their Bull Run; MapmyIndia Biggest Gainer This Week appeared first on Inc42 Media.

Riding on the back of the bull run in the broader market sentiment, Indian new-age tech stocks witnessed significant northbound momentum this week.

Eighteen out of the 23 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.1% to over 27%. TAC Infosec emerged as the top gainer, followed by Yudiz. Both the NSE Emerge-listed stocks rallied over 27% during the week.

Among the other gainers were ideaForge (up 13.2%), Paytm (up 11.5%), DroneAcharya (up 11.1%), Awfis (up 8.4%), Nazara, and PB Fintech (both up over 6%).

Meanwhile, following a major block deal, Mamaearth became the biggest loser this week. Its shares fell 2.2%. 

Despite its shares touching an all-time high mid-week following strong FY24 earnings, newly-listed Go Digit also fell 0.3% this week. The insurance tech platform posted over a 400% jump in profit after tax (PAT) to INR 182 Cr FY24 from INR 36 Cr in the previous fiscal year.

The other losers of the week were Tracxn, CarTrade, and MapmyIndia.

In the broader market, benchmark indices Sensex and Nifty50 gained 0.39% and 0.75%, respectively. While Sensex ended the week at an all-time high close at 76,992.77, Nifty50 too ended at a record close at 23,465.60.

Speaking on the market performance this week, Vinod Nair, head of research at Geojit Financial Services, said that the mid and small-cap sectors demonstrated outperformance during the week, on positive sentiment for growth-based stocks. 

Meanwhile, domestic CPI data suggests a gradual decline in inflation, he noted. 

“Though the last mile towards the inflation target remains sticky, given the expectation of a normal monsoon, investors are hopeful that the MPC will be one step closer to the easing cycle,” Nair said. “In the upcoming week, attention will be on the release of industrial production data from India, China, and Eurozone inflation as investors seek insights into the economic outlook of these countries.”

Meanwhile, the US Federal Reserve kept its key interest rate unchanged this week and signalled just one cut before the end of the year.

Prashanth Tapse, senior VP (research) at Mehta Equities, said that as expectations start building up from the government in the run-up to the Budget next month, markets might face bouts of intra-day volatility going ahead.

Next week will also see the listing of another new-age tech stock, ixigo. This week, the traveltech startup’s public issue was oversubscribed 98.34X. 

Now, let’s dive deeper into understanding the performance of the new-age tech stocks this week.

The 23 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $55.2 Bn as against around $54 Bn last week.

Paytm’s Mixed Week

After being under selling pressure for months, shares of fintech major Paytm witnessed a sudden rally this week. The stock gained about 11.5%, ending the week at INR 424.9 on the BSE.

The company’s shares last closed above the INR 400 level at the beginning of April this year.

Though the shares rallied largely on the back of positive developments around restructuring, it was a mixed week for the company. 

In The News For:

• Inc42 learned from multiple sources that Paytm has been asking employees to resign voluntarily or face disciplinary action. Besides, the company is also trying to retrieve various bonuses already paid to the employees. The company has denied the allegations.
• Paytm informed its stakeholders about a few positive developments, including its partnership with Samsung Wallet for flight, bus, movie, and event ticket bookings.
• The Insurance Regulatory and Development Authority of India (IRDAI) has accepted Paytm General Insurance’s registration withdrawal application. Paytm will now focus on the distribution of insurance products of other insurers.

Booking some profit from the share price surge, hedge fund Marshall Wace offloaded 5.85 Lakh shares worth INR 25.08 Cr in the company in a block deal on Friday (June 14). The shares were lapped up by BNP Paribas.

Though Paytm shares gained quite a bit this week, Rupak De, senior technical analyst at LKP Securities, said that currently there is no clear trend emerging from the movement.

De sees support for the stock in INR 420-INR 400 range while he has a bullish stance on Paytm if it crosses INR 440 level. 

Paytm is still trading over 33% lower year to date.

Nykaa’s Growth Projections

Shares of Nykaa continued to trade sideways this week. The stock gained 0.6% overall, ending the week at INR 170.95 on the BSE.

However, on the company’s ‘Annual Investor Day’ on Friday, its shares surged almost 5% to INR 175.15 during intraday trading.

Here are a few key developments from the meeting:

• Nykaa Fashion aims to turn EBITDA positive by the end of the financial year 2025-26 (FY26).
• The company said that it is working to improve its delivery timelines and looking to introduce express delivery service in metro cities.
• Nykaa has projected its beauty business to grow at a CAGR of mid-to-late 20% till FY28 and the fashion vertical to grow to 2.5-3X over the next three years.

On the other hand, Nykaa also announced expanding its ESOP pool size by allocating more than 4.73 Lakh equity shares to its employees. The newly allotted shares are worth over INR 9.72 Cr.

It is pertinent to note that shares of Nykaa have largely witnessed a range-bound movement since the beginning of the year. LKP Securities’ De sees INR 167 as the immediate support for the stock.

He sees a bull case for the stock only after Nykaa closes above INR 174.

Large Block Deal At Mamaearth

Shares of D2C beauty brand Mamaearth were volatile this week. Partially hurt by two large share offloading, the stock fell 2.2% during the week to end at INR 427.65 on the BSE and emerge as the biggest loser.

Its two major pre-IPO shareholders, Fireside Ventures and Sofina Ventures, offloaded 32.42 Lakh shares each in the company worth INR 141.21 Cr and INR 141.06 Cr, respectively.

In the quarter ended March 2024, Fireside held 1.71 Cr shares and Sofina held 1.99 Cr shares in the company.

Following the offloading on Tuesday (June 11), Mamaearth shares fell almost 5% on the day. The next day, its shares fell further.

Meanwhile, the company also announced this week that its partnership with Reliance Retail has taken its store count to 1,000 in Smart Bazaar or Smart Point stores. 

Shares of Mamaearth are currently trading 2.9% lower year to date.

The post New-Age Tech Stocks Rally On Bull Run In Broader Market; Mamaearth Biggest Loser This Week appeared first on Inc42 Media.

The Indian new-age tech stocks witnessed significant volatility this week, in line with the broader market trends as projection of exit polls and then Lok Sabha election results dictated investor sentiment at the beginning of the week.

After a slump on the vote counting day on Tuesday (June 4), 17 out of the 23 new-age stocks under Inc42’s coverage gained this week in a range of 0.3% to over 15%.

Nazara Technologies emerged as the biggest gainer, with its shares rallying 15.5%. It was followed by three newly-listed startups – Go Digit (up 13.7%), Awfis (up 11.3%), and TBO Tek (up 8.2%).

Paytm, Tracxn, IndiaMART, RateGain, Zomato, and DroneAcharya were among the other gainers this week.

However, shares of PB Fintech, EaseMyTrip, and Yatra declined marginally this week. Meanwhile, Mamaearth fell 1.3%, CarTrade declined 5.5%, and Yudiz slumped 10.4%.

In the broader market, benchmark indices Sensex and Nifty50 shot up over 3% on Monday on the exit polls results indicating a comfortable majority for the Prime Minister Narendra Modi-led National Democratic Alliance (NDA). However, on Tuesday, both the indices slumped almost 6% as the ruling Bharatiya Janata Party (BJP) fell short of the majority mark.

However, in the last three trading sessions of the week, the market revived again as the BJP and its alliance parties together are set to form the government. Overall, Sensex gained 3.69% this week, ending at 76,693.36 and Nifty50 gained 3.37% ending at 23,290.15.

Siddhartha Khemka, head of retail research at Motilal Oswal, said that strong domestic economic data, falling oil prices, and NDA unanimously passing a resolution to elect PM Modi as the leader of the coalition has uplifted investor confidence. 

It must be noted that the Reserve Bank of India (RBI) this week raised the country’s GDP growth forecast for FY25 to 7.2% from 7% earlier.

“Global cues added to the positivity with the European Central Bank announcing interest rate cut by 25 bps for the first time in nearly five years, moving faster than its US and UK counterparts. Now hopes have revived that the US Fed might cut interest rate in the September meet, based on recent macro data points,” he said.

“Next week, the focus will be on the allocation of key cabinet portfolios such as finance, defence, roads, energy, commerce, and railways ministries. The market will continue to be volatile with upward bias,” added Khemka.

Meanwhile, the INR 740 Cr IPO of traveltech startup ixigo is opening for subscription next week.

Now, let’s take a deeper look at the performance of the new-age tech stocks this week.

The 23 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $54.01 Bn as against $52.3 Bn last week.

Nazara Emerges As The Biggest Gainer

Shares of Nazara rallied 15.5% this week, despite a 14% decline on Tuesday, to close at INR 811 on the BSE – a level last seen towards the end of February this year.

The stock has been on an upward trend since Nazara posted its Q4 FY24 earnings two weeks ago. Though its profit declined in Q4, certain metrics in its results were better than expected by analysts. 

Besides, Nazara also increased its stake in Nextwave Multimedia Private Limited, the developer of mobile cricket game franchise World Cricket Championship, to 100% by acquiring an additional 28.12% stake.

Meanwhile, this week, its subsidiary Absolute Sports announced the US market foray by acquiring Pennsylvania-based entertainment news site Soap Central for $1.4 Mn (around INR 11.6 Cr) in an all-cash deal.

Shares of Nazara started gaining strength after a slump at the beginning of this year. The stock is still trading 5.3% lower year to date (YTD).

PB Fintech CEO Gets SEBI Show Cause Notice

CEO and chairperson of PB Fintech Yashish Dahiya received a show cause notice from the markets regulator Securities and Exchange Board of India (SEBI) on Thursday (June 6). 

The show cause notice is regarding a $2 Mn investment made by PB Fintech FZ-LLC, Dubai in outsourced marketing services provider YKNP Marketing Management in November 2022 to acquire a 26.72% stake.

Meanwhile, Tencent Cloud Europe B.V. also offloaded 33 Lakh shares in the company on Thursday in a bulk deal worth INR 415.7 Cr.

Shares of PB Fintech, which had started gaining upward momentum after Tuesday’s market slump, fell again in two consecutive trading sessions on Thursday and Friday. The stock ended the week 0.07% lower at INR 1,288.05 on the BSE.

The stock rallied significantly since the beginning of the year and is currently trading 62.2% higher YTD.

Zomato-Owned Blinkit’s Warehouse Raided

A warehouse of Zomato’s quick commerce platform Blinkit was raised by the Telangana food safety department this week in the state’s Medchal Malkajgiri district. The task force found the premises to be “disorganised, unhygienic and dusty”.

Several packets of expired food products were also found in the raid.

On the other hand, amid the severe heat wave in several parts of the country, Zomato urged its users to avoid placing delivery orders during the peak afternoon, which also sparked a major debate across social media platforms.

Shares of Zomato have recently lost their upward momentum after touching INR 200 level in May. The recent decline was partially also triggered by brokerage Macquarie reiterating its ‘underperform’ rating on the stock and a price target of INR 96.

Despite volatility, Zomato ended the week 2.9% higher at INR 184.05 on the BSE.

The post New-Age Tech Stocks Rally In Volatile Election Result Week, Nazara Emerges Top Gainer appeared first on Inc42 Media.

Continuing the slump of the previous week, new-age tech stocks witnessed a bearish market sentiment this week as well. Most of these stocks declined in line with the broader market, which came under pressure as the Lok Sabha elections entered the last phase.

Only five of the 22 new-age tech stocks under Inc42’s coverage gained this week in a range of 1% to about 15%. 

The top gainer of the week was gaming major Nazara Technologies, which surged 14.23%. Last week, the company reported a sharp decline in its profit in the fourth quarter of the financial year 2023-24 (FY24). 

Paytm’s parent One 97 Communications Ltd, D2C unicorn Mamaearth’s parent Honasa Consumer, recently-listed B2B travel portal TBO Tek or Travel Boutique Online, and fintech major PB Fintech were the other gainers this week.  

On the other hand, 18 startups saw a decline in the range of 0.4% to 23%. Last week’s top gainer Zaggle, Nykaa’s parent FSN E-Commerce Ventures, TAC Infosec, and DroneAcharya were among the biggest losers this week. 

It is pertinent to note that besides Nazara, the week saw DroneAcharya, TBO Tek, TAC Infosec, Yatra, and Yudiz declare their financial results for the March quarter of FY24. 

The biggest loser this week was blockchain and IT development company Yudiz Solutions. Its shares plummeted about 23% week-on-week to INR 59.30 on the NSE on May 31. The company slipped into the red in FY24 with a net loss of INR 2.9 Cr.

Meanwhile, coworking space provider Awfis made a strong market debut on the BSE and the NSE on May 30.

Awfis’ shares listed at INR 432.25 on the BSE, 12.8% higher than the issue price of INR 383. Similarly, on the NSE, the startup’s shares listed 13.5% higher than the issue price at INR 435 apiece. However, the stock closed the week at INR 402.5 on the BSE. 

Meanwhile, benchmark indices Sensex and Nifty50 fell about 1% each to close the week at 73,961.31 and 22,530.70, respectively. Market experts attributed this decline to “election-related nervousness”. 

“Due to the lack of positive triggers, the bulls faced resistance at higher levels, leading to profit booking across the sector. The caution ahead of the exit poll results… prompted market participants to sideline riskier assets. However, investors are adjusting their portfolios to align with fundamentally strong sectors and stocks, as robust Q4 FY24 earnings and better-than-expected Q4FY24 GDP growth will continue to provide a buffer on valuation in the medium term,” he said. 

On Friday, government data showed that the country’s gross domestic product (GDP) grew 8.2% in FY24. The GDP grew by 7.8% in the fourth quarter of FY24.

Meanwhile, the marathon seven-phase Lok Sabha elections concluded on Saturday (June 1). Following the final phase of voting, almost all the exit polls projected a comfortable majority for the Prime Minister Narendra Modi-led National Democratic Alliance (NDA).

The results for the general elections will be announced on Tuesday (June 4).

Now, let’s take a deeper look at the performance of the new-age tech stocks this week.

The 23 new-age tech stocks under Inc42’s coverage (with Awfis being the latest addition) ended the week with a total market capitalisation of $52.3 Bn as against 22 of them ending the previous week at $53.1 Bn.

Signs Of Revival For Paytm?

Reversing the downward trend, shares of fintech major Paytm gained 5.94% this week. 

The Vijay Shekhar Sharma-led company’s shares hit the upper circuit twice this week. 

In The News For:

• The fintech giant has aborted its plans to foray into the insurance space by pulling back its application for a general insurance licence. 
• The company denied a report which said that Paytm was in talks with the Adani Group for the latter to acquire a stake in the former. 
• Amid a top-level exodus, Paytm’s chief human resources officer (CHRO) Swati Rustagi is now quitting the startup.

Last month, Paytm reported a net loss of INR 550.5 Cr in Q4 FY24, more than 3X from the INR 167.5 Cr loss it reported in the year-ago period.

Brokerage firm YES Securities’ has a ‘buy’ rating on Paytm, with a price target (PT) of INR 450. 

“After being under pressure, the merchant payments business started to grow in April and May. On the other hand, monthly transacting users, which drive consumer payments business, are down 25% compared with January. April was the worst month for MTUs but this has stabilised in May. MTU growth will happen once the TPAP commencement happens,” it said.

Meanwhile, Motilal Oswal retained its ‘Neutral’ rating on the stock after the Q4 results. It has a PT of INR 400. 

Nazara Gains Despite Poor Q4 Show

Nazara was the biggest gainer this week despite a sharp decline in its profit in Q4 FY24. The gaming major reported a steep 98% YoY decline in net profit to INR 18 Lakh in Q4 from INR 9.4 Cr in the year-ago quarter. The decline in the company’s profit was due to the INR 11.37 Cr charges it incurred due to goodwill impairments, along with an INR 10.56 Cr dent for intangible assets related to the gaming segment during Q4.

Operating revenue also declined 8% year-on-year (YoY) to INR 266.2 Cr in Q4 FY24 from INR 289.3 Cr in the same quarter a year ago.

Besides the poor financial performance, its promoter Mitter Infotech also sold 48.84 Lakh shares, or 6.38% stake, to Plutus Wealth Management in an on-market block deal. 

Brokerage firm ICICI Securities maintained its ‘Buy’ rating on the stock, with a PT of INR 1,080. This is a 53% upside from the stock’s last close of INR 702. 

“In Q4FY24 Nazara beat I-sec margin estimates given 729 bps QoQ improvement in Nodwin EBITDA margin… At current valuation (23x one-year forward ex minority EV/EBITDA), we believe Nazara is a compelling BUY,” the brokerage firm said.

PB Fintech Gains On MSCI Index Inclusion

Despite falling in three consecutive sessions at the start of the week, shares of PB Fintech gained nearly 1.6% this week. The stock surged nearly 9% during the last trading session of the week on PB Fintech’s addition to the MSCI Global Standard Index, which was to come into effect from the close of May 31.

In The News For

• On Monday (May 27), the company said that it successfully acquired 100% stake in UAE-based insurance broker Genesis Group
• The company approved the allotment of 48.3 Lakh shares of employee stock option plan (ESOP)
• Last month, the company’s CEO Yashish Dahiya and vice chairman Alok Bansal offloaded more than 83.7 Lakh shares via open market transactions for INR 1,109 Cr ($132 Mn). 

PB Fintech reported a consolidated net profit of INR 60.2 Cr in Q4 FY24 against a loss of INR 9.3 Cr in the previous year’s quarter.

The post New-Age Tech Stocks Continue To Bleed; Nazara Biggest Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks witnessed a southbound movement this week amid less than impressive financial performances of some listed companies in Q4 FY24. 

Only four of the 22 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.15% to about 9%. 

Zaggle emerged as the top gainer with shares rallying 8.8% this week on the back of an impressive financial performance in the last quarter of FY24. The fintech SaaS startup posted a more than 153% jump in its profit after tax (PAT) to INR 19.2 Cr in Q4.

The other three gainers this week were Mamaearth, Fino Payments Bank, and ideaForge. 

The shares of 18 tech stocks slipped, in a range of 0.7% to 18.5% during the week. The names included last week’s top gainer PB fintech, Paytm, Nykaa, and TAC Infosec. TAC Infosec turned out to be the biggest loser with shares falling 18.54% on the NSE. 

Paytm and Nykaa also reported their respective Q4 performances this week.

Amid the bearish market sentiment, insurance tech unicorn Go Digit also made an underwhelming public market debut this week. Its shares were listed at INR 286 per share on NSE, a 5.1% premium to the issue price of INR 272. Its shares were listed at INR 281 on the BSEat a meagre 3.3% premium. 

Brokerage firm Emkay initiated its coverage on the startup’s shares, giving it a ‘sell’ rating price target (PT) of INR 210. Besides Digit, coworking startup Awfis is also expected to list within this month. It closed its public issue on Friday (May 24) with an oversubscription of 11.4X. The startup received bids for 9.84 Cr shares as against the 86.29 Lakh shares on offer.

The sentiment towards new-age tech stocks this week was stark opposite to the broader equity market. Benchmark indices Sensex and Nifty50 increased 1.8% and 2.1%, respectively. While Sensex ended the week at 75,410.39, Nifty50 ended at 22,957.1. 

Commenting on the market performance, Vinod Nair, head of research at Geojit Financial Services said that the domestic market gains are opposite to global market sentiments, which remained subdued due to the continued hawkish stance on policy rates.

“The domestic market is reaching new highs, with large caps playing second fiddle to the broader market rally, indicating sustained momentum in the short term. The BSE PSU index has experienced significant rerating due to strong performance and improved visibility, driven by PSU banks and defence stocks,” said Nair.

It is pertinent to note that the bourses this week were closed on Monday (May 20) due to on account of the ongoing General Elections voting day in Mumbai. 

Against this backdrop, here’s a deeper look at the performance of some of the new-age tech stocks this week.

The 22 new-age tech stocks ended this week with a total market capitalisation of $59.56 Bn as against 21 of them ending the previous week at $51.35 Bn.

Paytm Continues To Bleed

Shares of the fintech major shrunk 3% on the BSE this week, ending the last trading session at INR 340.95. The decline is owed to the company announcing a heavy dent in its financial performance earlier this week. 

In The News For:

•  Paytm’s net loss widened over 3X on a year-on-year (YoY) basis to INR 550.5 Cr in Q4 FY24 from INR 167.5 Cr reported in the year-ago period. Its revenue from operations also decreased 2.9% YoY to INR 2,267.10 Cr, compared to INR 2,334 Cr in the same period last year.
• The company informed the bourses that its merchant business saw higher attrition in February and March when Paytm was forced to transition its merchants from its payments bank to other bank partners. This led to its active point of sale device base plummeting by 10 Lakh despite a marginal increase in the merchant base.
• Observing industry-wide decline in asset quality, the Vijay Shekhar Sharma-led company paused its small personal loans business as well as completely shutting its Postpaid portfolio. The company also reported a 36% YoY decline and a steeper 50% sequential decline in its financial service arm revenue which stood at INR 304 Cr revenue. 

Despite the flailing condition of the stock, analysts are of a mixed view towards the startup’s shares. Brokerage firm YES Securities gave the fintech major’s shares a ‘buy’ rating along with a PT of INR 450, observing some upturn in its payments business. 

“After being under pressure, the merchant payments business started to grow in April and May. On the other hand, monthly transacting users, which drive consumer payments business, are down 25% compared with January. April was the worst month for MTUs but this has stabilised in May. MTU growth will happen once the TPAP commencement happens,” it said.

However, Ganesh Dongre, senior manager of technical research, Anand Rathi, anticipates the startup’s stock to reach INR 328-INR 330 level in the upcoming days. 

“Currently, we don’t recommend a buy in this counter because there are possibilities of the shares going down from the current level,” he said. 

Mamaearth’s First Profitable Fiscal Attracts Investors

With a positive outlook from its financials, Mamaearth’s parent Honasa Consumers shares zoomed about 6% this week to close Friday’s trading at INR 430.50 on the BSE.

For the fiscal year, it reported a net profit of INR 110.5 Cr as against the INR 150.96 Cr loss it incurred in FY23. Similarly, operating revenue for the entire fiscal also jumped 30% to INR 1,919.6 Cr in the year ended March 2024 from FY23’s INR 1,492 Cr.

It also posted a net profit of INR 30.47 Cr Cr in Q4, a 17% sequential increase from the previous quarter’s INR 28.91 Cr.

Brokerage firms turned bullish over the startup’s shares post the financial disclosure. While JM Financials, Kotak Institutional Equities, and Emkay maintained a ‘buy’ rating on the stock and gave it a PT of INR 505, INR 450, and INR 500 respectively.

Brokerages expect the company to bank on its “house of brands” strategy moving forward. Kotak highlighted that although its flagship brand Mamaearth’s growth decelerated to 6-7% in FY24, there was a “nice heavy lifting by the younger brands.” 

“Honasa would be able to replicate Mamaearth’s success with some of its other brands which should aid overall revenue performance, enable it to extract savings across lines and drive profitability,” JM Financials said.

Anand Rathi’s Dongre said that he wouldn’t recommend a buy on Mamaearth as there are possibilities of some correction towards the INR 390 level.

Nykaa’s Q4 Results Fail To Excite The Market

With a lukewarm performance in the final quarter of FY24, Nykaa’s share price declined 4.87%, standing at INR 168.15 by the end of the week. 

Nykaa’s consolidated net profit plunged by 48% on a quarter-on-quarter (QoQ) basis to INR 9.07 Cr from Q3 FY24’s INR 17.45 Cr. Its operating revenue also declined 6% on a sequential basis to INR 1,667.9 Cr from the previous quarter’s INR 1,788.8 Cr.

Brokerage firms hold mixed feelings for the shares of the Falguni Nayar-led brand. 

JM Financial reiterated its ‘buy’ rating on the stock and increased the target price for Nykaa to INR 220 apiece from INR 210 earlier. 

“Overpowering the recent discretionary spending slowdown, Nykaa reported robust 30%/27%/68% YoY growth in BPC/Fashion/Others segments… [The] company reported strong operating metrics across transacting users, conversion and AOVs, indicating rising business momentum. We reiterate a ‘buy’ rating with a TP of INR 220,” it said in a note.

However, ICICI Securities downgraded the Nykaa stock to a ‘hold’, while maintaining a price target of INR 175. The homegrown brokerage cited margin concerns and growing competition from other players in the space as the reason for this. 

“While the revenue growth trajectory is improving, ad revenue growth (as a proportion of GMV) remains muted. Also, increasing competitive intensity from other channels/players and its potential impact on margin remains unclear at this point,” ICICI Securities said in a note.

Anand Rathi’s Dongre said that some more correction is expected in this counter till the INR 150 level.

The post New-Age Tech Stocks Slump This Week But Zaggle Emerges As The Biggest Gainer appeared first on Inc42 Media.

The Indian new-age tech stocks witnessed a mixed performance this week as multiple factors, including a revival in the broader equity market, strong Q4 FY24 performance of a few startups and stock-specific developments, led to variations in trading.

Ten out of the 20 new-age tech stocks under Inc42’s coverage this week gained in a range of 0.9% to over 13%. PB Fintech emerged as the top gainer with shares up 13.3% this week.

Among the other gainers were MapmyIndia, RateGain, EaseMyTrip and ideaForge. We must note that this week drone startup ideaForge posted a 30% decline in its consolidated profit after tax (PAT) to INR 10.3 Cr in the March quarter.

On the other hand, 10 others, including Paytm, Fino Payments Bank, Zomato, Mamaearth, Delhivery and TAC Infosec saw a southbound movement this week in a range of 1.5% to 5.2%.

Mamaearth turned out to be the biggest loser with shares falling 5.2% on the BSE.

Both Zomato and Delhivery also reported their respective Q4 performances this week.

Meanwhile, there is a new entrant among the new-age tech stocks. B2B travel portal Travel Boutique Online or TBO Tek made a strong public market debut this week. Its shares were listed at a 55% premium, at INR 1,426, on the NSE and a 50% premium, at INR 1,380, on the BSE.

At least two more new-age tech startups are expected to get listed this month. 

Insurtech unicorn Go Digit General Insurance’s (Digit) is set to get listed on May 23. Its public issue was subscribed 9.6X on the final day of its bidding on May 17. 

On the other hand, coworking startup Awfis’ public issue will open for bidding on May 22. It has set a price band of INR 364-INR 383 for its upcoming INR 599 Cr IPO.

This week, the Indian stock market had a special trading session on Saturday (May 18). 

In the broader market, benchmark indices Sensex and Nifty50 increased 1.85% and 2.03%, respectively. While Sensex ended the week at 74,005.94, Nifty50 ended at 22,502. 

Commenting on the market performance, Vinod Nair, head of research at Geojit Financial Services, said that the domestic market sustained its recovery momentum from the recent lows, primarily helped by positive signals from its global counterparts and better-than-anticipated earnings from index heavyweights. 

“The broader market remained positive, driven by persistent buying in heavyweight sectoral stocks. Furthermore, a moderation in India’s CPI and lower-than-expected inflation figures from the US Fed have stimulated investor confidence,” he said. 

Despite favourable global cues, there are still uncertainties around upcoming general election results. Amid this, analysts expect volatility to continue in the market.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The 21 new-age tech stocks ended this week with a total market capitalisation of $51.35 Bn as against 20 of them ending the previous week at $49.02 Bn.

Zomato Slumps Despite A Strong Q4

Shares of foodtech major Zomato fell 3.4% on the BSE this week, ending the last trading session at INR 194.35.

In The News For:

• Zomato’s consolidated PAT jumped 26.8% quarter-on-quarter (QoQ) to INR 175 Cr in Q4 while operating revenue increased over 8% to INR 3,562 Cr. Its quick commerce business Blinkit turned adjusted EBITDA positive in the month of March 2024. 
• Blinkit is emerging as a stronger business of Zomato over its core food delivery vertical. The quick commerce arm’s operating revenue zoomed 112% YoY and 19% QoQ to INR 769 Cr in Q4.
• Meanwhile, Zomato is aiming to expand and scale its home-cooked meal service ‘Zomato Everyday’ in Bengaluru and Mumbai.
• The company disclosed that it has voluntarily surrendered the certificate of authorisation it obtained from the Reserve Bank of India (RBI) to operate as an online payment aggregator.
• Zomato is also expanding its priority delivery offering to more cities like Delhi, Hyderabad and Pune. 
• The company has also sought approval from its shareholders for the formulation, adoption and implementation of a new employee stock option plan, Zomato ESOP 2024, to grant 18.26 Cr employee stock options.

Following the Q4 FY24 earnings announcement, a few brokerages increased their price targets (PTs) on Zomato. Bernstein increased the PT to INR 230 from INR 200 on the back of the strong Blinkit growth expectations.

The brokerage expects Blinkit to grow more than 40% YoY.

Nuvama hiked its PT on Zomato to INR 245 from INR 180 earlier. “We anticipate the aggressive addition of dark stores to hurt margin expansion for Blinkit in the next two quarters, but this effect is expected to be more than offset by higher margins in FY26,” the brokerage noted.

Elara Capital also hiked its PT on the stock to INR 280 from INR 250 earlier.

However, Kotak Institutional Equities cut its fair value on Zomato to INR 225 from INR 230 earlier.

“We like the company for sharp execution across verticals,” said the brokerage. “Weak demand for Zomato’s services and higher competitive intensity are key risks to our call.”

Delhivery Slips Into Loss In Q4

Ahead of its Q4 earnings announcement on Friday (May 17), shares of Delhivery ended the day’s trading session 0.8% higher at INR 453.85 on the BSE. 

However, the shares slumped almost 4% during Saturday’s trading session, ending the week at INR 435.9.

In The News For:

• After reporting its maiden profitable quarter in Q3 FY24, Delhivery slipped into losses in Q4 with a consolidated net loss of INR 69 Cr. 
• Its top line was hurt by a decline in its express parcel and cross-border services during the quarter, which the company attributed to a fall in shipment volume due to a softness in ecommerce demand and to the Chinese New Year, respectively.
• The logistics unicorn announced its setting up a wholly-owned subsidiary, Delhivery Robotics India, to manufacture drones and provide freight air transportation services.
• Its executive director and chief business officer Sandeep Kumar Barasia resigned.
• Delhivery also announced the allotment of 75,000 stock options under its Employee Stock Option Plan (ESOP) 2012.

Overall, the shares of Delhivery fell almost 3.8% this week hurt by its Q4 performance update.

PB Fintech Emerges As The Biggest Gainer

Reversing last week’s sharp decline, shares of PB Fintech rallied 13.3% this week, closing at INR 1,359.7 on the BSE on Saturday.

We must note that last week the parent entity of insurtech major Policybazaar posted a 62% QoQ jump in its consolidated net profit to INR 60.2 Cr in the March quarter. Post the sharp rally this week, the market cap of PB Fintech also crossed the $7 Bn mark.

On the back of its rising market value, PB Fintech also got added to the MSCI India Index in the May review.

Top executives of the fintech major – Yashish Dahiya and Alok Bansal – sold 83.7 Lakh shares in the company via block or bulk deals.

The offloaded shares were lapped up by several institutional investors, including multiple funds of HSBC, Axis Mutual Fund, and HDFC, BNP Paribas Arbitrage, and Goldman Sachs.

The shares of PB Fintech are currently trading at a level last seen in mid-November 2021, just post its listing.

Following the company’s strong Q4 show, ICICI Securities hiked its PT on PB Fintech to INR 1,311 from INR 818 earlier.

“The moat of the platform has been well established in FY24, having grown more than the industry in key segments (health/life) along with important client wins. Ability to gain market share, expansion of client base and growth in registered customers are structural advantages,” said the brokerage.

Overall, its shares have gained over 71% year to date.

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