By Zomato shares surged 7.7% in early morning trading today, climbing to ₹261.60 per share. The rally came after global brokerage firm JP Morgan raised its target price for the stock from ₹208 to ₹340 per share, signaling a potential 40% upside from its last closing price of ₹242.
This revision puts JP Morgan among the most optimistic analysts, with only CLSA assigning a higher target price of ₹353. CLSA continues to maintain an “overweight” rating on Zomato, highlighting its strong growth prospects.
The boost in target price reflects growing confidence in Zomato’s quick-commerce business, Blinkit. After showing promising results in the NCR region, Blinkit has now expanded to all major metro cities in India. JP Morgan’s bullish outlook is driven by Blinkit’s increasing scale and its potential to disrupt modern trade and e-commerce.
The brokerage expects Blinkit’s growth to significantly improve monetization through higher channel margins and advertising revenue, projecting strong financials in the years to come. Blinkit’s improving store-level economics are also expected to bolster the company’s EBITDA outlook. As a result, JP Morgan has revised its FY25-27 forecasts for Zomato upward by 15% to 41%.
CLSA shares this bullish stance, having named Zomato its top consumer pick in India. CLSA believes that Blinkit’s expansion in the quick-commerce segment will transform Zomato.
According to their projections, Blinkit is on track to achieve profitability by FY25, which would be a major milestone for the company. CLSA also believes that Zomato will be the primary beneficiary of the transformation happening within India’s supply chain, largely driven by the rapid growth of quick commerce.
Zomato’s stock has been on an upward trajectory, fueled by the company’s strategic acquisitions and its growing dominance in the food delivery and quick-commerce markets. The acquisition of Blinkit and Paytm’s ticketing business has diversified Zomato’s portfolio and positioned it as a key player in India’s evolving consumer tech space. However, the company’s recent moves have not come without some adjustments.
Despite the bullish outlook, JP Morgan has reduced its FY26 profit estimates by up to 12%, factoring in the impact of Zomato’s acquisitions, particularly the Paytm ticketing business.
Zomato has continued to outperform in both the food delivery and quick-commerce segments. In Q1FY25, Blinkit reported an adjusted EBITDA loss of ₹3 crore, but the company exceeded its store addition guidance by opening 113 new stores. Despite this rapid expansion, Blinkit has managed to improve its profitability, with analysts noting that the quick-commerce arm could potentially become more profitable than Zomato’s core food delivery business.
The positive sentiment surrounding Zomato is not limited to JP Morgan and CLSA. Other global brokerage firms have also revised their target prices for the stock in recent months. UBS, for instance, recently raised its target to ₹320 per share, up from the previous target of ₹260.
The brokerage attributed this revision to Zomato’s better-than-expected June quarter results, particularly the 27% growth in gross merchandise value (GMV) for its quick-commerce business.
Jefferies has also adjusted its target price for Zomato, setting it at ₹275 while maintaining a ‘buy’ rating. Morgan Stanley, too, has reaffirmed its “overweight” rating on the stock with a target price of ₹278.
Nomura has increased its target price from ₹225 to ₹280, also maintaining a “buy” recommendation. The consensus among these analysts is that Zomato’s growth potential, particularly in the quick-commerce space, makes it an attractive investment opportunity.
Looking ahead, quick commerce is expected to grow rapidly, with some analysts projecting an annual growth rate of 100% to 110% during FY25-FY26. Zomato’s Q-commerce segment is approaching an EBITDA breakeven, with forecasts suggesting a -0.1% margin in FY25, and an eventual positive margin of +1.1%. These projections further strengthen the case for Zomato’s long-term growth potential, as the company continues to expand its footprint in India’s fast-evolving tech landscape.
Zomato’s strong performance in both food delivery and quick commerce has placed it in a favorable position in the Indian market. With the backing of major global brokerage firms and its expanding portfolio, Zomato appears to be on track for sustained growth, with the possibility of achieving profitability in the near future. Investors will be closely watching how the company’s ambitious expansion plans unfold in the coming quarters.
