Zomato Share Price Enters A Deeper Correction – Here’s My Target
Zomato (NSE: ZOMATO) share price is having a major pullback this week. The stock of the Indian restaurant aggregator has been on a tear since the start of this year. In 2023, the shares have surged more than 52% and are eying more upside.
On Wednesday, Indian stock is experiencing a bearish sentiment. At press time, Nifty 50 and BSE Sensex are down 0.41% and 0.45%, respectively. Zomato shares opened at Rs 93.90 today, which was higher than their previous close of Rs 93.45. However, the sellers prevailed once again, and the stock is now changing hands at Rs 93.25.
Why Are Zomato Shares Falling Today?
Zomato reported its Q1 financial results on 3rd August. The report showed the first profitable quarter for the company beating its own estimates. Zomato share price NSE soared more than 25% on the news of a profit after tax of Rs 2 crore. However, there was a little caveat that most investors ignored.
A deeper look at the Zomato results reveals that the 64% increase in the company’s quarterly income came at the expense of 48% more spending. This resulted in a pre-tax loss of Rs 15 crore. However, this loss was offset by the deferred tax gain of Rs 17 crore, resulting in a profit after tax of Rs 2 crore.
Zomato Share Price Forecast
A look at the following NSE: ZOMATO chart reveals that the shares have broken out of the Rs 50 to $75 trading range. Right now, the stock is having a pullback after peaking at Rs 102.85 last week. The next key level to watch is the 0.5 fib retracement level which currently lies at Rs 104.85.
A reclaim of this level will make Zomato share price forecast very bullish, with the next target of Rs 115 in sight. However, in case of rejection from this level, the stock price may revisit the 85-88 region. Considering the ongoing momentum, the bullish case seems to be more likely.
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