Paytm shares are trading at Rs 832.35. Over the past six months, this share has returned around 24% to its investors. On the other hand, after the quarterly results, Zomato’s share price climbed nearly 14% in 5 days, reaching the Rs 100 level.
Paytm and Zomato… The story of these two companies was similar some time ago. Investors in both companies were in distress, but today the tide has turned. On the one hand, Paytm’s shares took off at rocket speed, and on the other, after Zomato’s quarterly results (Zomato Q1 Results), a rally was seen in its shares. On Monday, Zomato shares broke the century mark. But will this boom continue, or will the downturn start again? We’ll leave you to find out what the experts have to say.
The downtrend has continued since the IPO. First, let’s talk about the change in trend of two stocks, Paytm and Zomato. After Paytm’s IPO, there was a period of steep decline and the bad days for investors didn’t end, but now happiness has returned to the faces of the company’s investors. Paytm’s stock market The Paytm share, which had fallen by over 60% from its IPO price, has once again begun to rebound.
On the other hand, when online food delivery company Zomato, presenting results for the June 2023 quarter, said it had made a profit of Rs 2 crore for the first time, the effect was also seen on the company’s shares. Zomato shares, which were worth Rs 50 six months ago, are now trading at Rs 100 after marking a century.
As for Paytm-Zomato and other new shares, Sameer Arora, founder of Helios Capital, says that he first bought One 97 Communications, Paytm’s parent company, and Zomato, two new shares, and that, despite the recent rise in both names, he still holds them, i.e. he hasn’t sold them despite the rise that occurred after a long period. He said we had bought both shares at attractive prices, but at the time they were around 60-70% below their peak.
Today, Paytm shares are trading at 832.35 rupees. Over the past six months, this share has returned around 24% to its investors. The all-time low for Paytm shares was 438.35 rupees and the high was 914.95 rupees, so looking at the latest situation, there has been a huge improvement in the performance of this stock. On the other hand, after the quarterly results, Zomato shares climbed nearly 14% in 5 days. The share price stood at 1.68 euros last Monday.
However, the share price rose by 1.68% to close at Rs 97. Whereas the share had reached the level of Rs 102.85 during trading. At the same time, until the news was written on Tuesday, this share was trading at the level of Rs 94.85 with a drop of two percent.
The scene has changed in 6 months
Sameer Arora says he bought Paytm for around Rs 500. Both these stocks have seen massive rises and we still hold them. However, their prices today are very different from what they were 5 or 6 months ago. He said that despite the tsunami that hit the shares of these two companies and the rise they are experiencing today, confidence remains because we have no problem with the business model of these two companies. But he urged caution on Paytm Zomato as well as other New Age stocks.
Effect of reduced competition in the market He said that, in fact, the outlook for these two stocks has now recovered, as other weak companies have almost exited the market. Two years ago, there were 100 fintech companies, but now there are only 15 or 20, of which only 1 or 2 are listed. Similarly, there were 15 funded food delivery companies, but only two remain today. Competition has therefore shrunk considerably. He added that there were still some survivors, but that their prospects had improved.
The founder of Helios Capital added that, apart from Paytm and Zomato in general, many other new-age stocks are also included in our portfolio. They have sometimes performed well, but their main shortcoming is that they don’t have a business model. Sameer Arora advised investors to own what they have. Losses were incurred by those who looked only at future prospects and not at price.
Effect of reduced market competition
He added that, in fact, the future prospects of these two stocks have recovered, as other weak companies have almost exited the market. Two years ago, there were 100 fintech companies, but today there are only 15 or 20, of which only 1 or 2 are listed. Similarly, there were 15 companies in the food delivery field that were in development, but today there are only two left*, so competition has dwindled considerably.