The value of Zomato shares nearly doubled in debut trading on Friday. The food delivery firm was valued at over $1 billion (about Rs 7,450 crore) in the first stock market listing of an Indian startup. Investors showed interest in Internet-based startups. The reason is that it is these startups that have the potential to grow well even during a pandemic like COVID-19. India’s stock market is currently at its all-time high.

Shares rose 82.8 per cent after opening at Rs 115 in pre-open trade. This stock also hit the upper circuit during trading which was Rs 138. There was a 52.6 per cent premium over the initial public offering (IPO) price of Rs 76. Due to which the value of the company is about $ 12 billion (about Rs 89,450 crore). Zomato’s 9,375 crore IPO, backed by China’s Ant Group, is a first for a startup in India’s food delivery market, estimated at $4.2 billion (about Rs 31,280 crore) by research firm RedSeer.

The homegrown food aggregator, launched in 2008, operates in around 525 cities in India and has partnered with around 390,000 restaurants. The company’s offering last week fetched a bid of $46.3 billion (about Rs 3,45,220 crore) as it was oversubscribed by more than 38 times, with large institutional investors also making major bets.

Danni Hewson, a financial analyst at AJ Bell, an investment platform in England, said, “Growth is of paramount importance here. While Zomato may not be profitable, it is growing rapidly and has to maintain that momentum. Enthusiastically deployed.” Zomato’s loss for the year ended March 31 was Rs 813 crore while revenue from operations fell marginally year-on-year to Rs 1,994 crore.

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