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Zomato, the leading Indian food aggregator, has announced another quarter of profitability, continuing its impressive financial performance. For the January-March (Q4) period, Zomato reported a net profit of Rs 175 crore, marking its fourth consecutive quarter in the green. This positive result comes amidst a challenging economic environment where many e-commerce companies are facing headwinds due to high inflation and muted demand.
The company's revenue also experienced significant growth during Q4, rising by 73 percent year-on-year to Rs 3,562 crore. This strong revenue performance is a testament to Zomato's continued expansion and its ability to capture a larger share of the growing online food delivery market. Notably, Zomato's revenue growth outpaced the broader e-commerce sector, which has been impacted by the aforementioned economic headwinds.
Zomato's stock price has responded positively to its recent financial performance, surging on the back of rising profitability in its core business and the fast growth of its quick commerce arm, Blinkit. The company's stock is currently trading at more than 100 times forward earnings, well above multiples for global peers including Uber, Deliveroo, and Meituan. This premium valuation reflects investors' confidence in Zomato's long-term growth prospects.
Analysts have attributed Zomato's strong performance to its focus on profitability and the potential of its quick commerce business. Goldman Sachs Group Inc. expects profit forecasts to increase for Blinkit as more results are reported, while ICICI Securities Ltd. believes that Zomato's valuations are justified given its projected revenue and profit growth. The company's stock has also benefited from improving sentiment on tech stocks around the world.
Overall, Zomato's Q4 results demonstrate the company's resilience and its ability to execute its growth strategy in a challenging economic environment. The company's strong financial performance and positive outlook have been well-received by investors, and Zomato is well-positioned to continue its growth trajectory in the future.
Source: Zomato Q4 results: Firm logs fourth straight quarter of profit at Rs 175 cr, revenue up 73%