Zomato and Paytm continued to remain under pressure today. They are hitting their lows respectively since listing. Zomato slumped over 18% in Monday’s early deals to ₹92 apiece on the BSE. On the other hand, Paytm shares were trading nearly 4% lower at ₹924 apiece.
The food delivery platform Zomato got listed in July 202. It is up more than 30% from its IPO issue price of ₹76. Also, Paytm is down over 57% from its issue price of ₹2,150.
See what V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services says.
“The trend in global stock markets has turned distinctly bearish. Last week S&P 500 and Nasdaq closed 8% and 15% below their all time highs. The sell-off in tech stocks has been brutal last week. European stocks too turned bearish. An important feature of the tech sell-off is that bulk of the selling is happening in non-profitable tech stocks. This trend is impacting stocks like Zomato and Paytm in India too”.
There is a risk-off situation across the globe amid fear of tightening by the US Fed where the trend shows a sharp sell-off in growth stocks. Especially loss-making new age companies that came out with unrealistic valuations amid euphoria in the market, as per analysts.
Here’s a statement by Santosh Meena, Head of Research, Swastika Investmart.
“We know that only a few companies will survive in the long run and I believe Zomato has the potential to perform in the long run. The recent price correction is leading to stock at a reasonable valuation where aggressive investors can use this correction as a buying opportunity with a long-term view”.
An advice by Sumeet Bagadia, Executive Director at Choice Broking. “Zomato shares are looking weak on chart pattern and it may go up to ₹75 levels after giving successive breakdowns at ₹110 and ₹100 apiece levels. Those who have this share in their portfolio should exit on bounce. While fresh investors are advised to take any buy position at current levels.”