Block deal: Zomato stock in news as SoftBank Vision Fund may offload Rs 940 crore worth shares

Shares of Zomato will be in focus on Wednesday amid reports that SoftBank Vision Fund (SVF Global) was looking to offload 1.17 per cent stake that in holds in food delivery giant for Rs 940 crore via a block deal. Citing sources, a CNBC TV-18 report suggested that a total of 10 crore shares will be sold by SVF Growth Fund, at a price of Rs 94 apiece. Kotak Securities will be broker to the deal, the report added.

The report comes days after Tiger Global's Internet Fund III Pte sold its entire 1.4 per cent stake in food delivery platform through open market transactions on Monday. Tiger Global sold the 1.4 per cent stake it got as a result of the Blinkit merger for $136 million. The lock-in expiry for those shares ended on Monday. The New York-based firm sold 12.35 crore shares at Rs 91.01 apiece to raise about Rs 1,124 crore. Tiger had invested $111 million in Blinkit, which represents 22 per cent profit.

Shares of Zomato are up 22 per cent in the last one month and 77 per cent in the last six months. Ventura Securities has suggested a target of Rs 156 on the stock for a time horizon of 24 months.

Zomato’s valuation of 3.7 times FY26 EV/sales may appear optically demanding compared to its global peers, it said. But the brokerage expects Zomato's revenue to grow at a CAGR of 41.9 per cent to Rs 20,215.5 crore by FY26, driven by 31.7 per cent CAGR growth in food delivery revenue

to Rs 10,632 crore, Hyperpure CAGR of 62.4 per cent to Rs 6,445.90 crore, dine-out & subscription CAGR of 13.3 per cent to Rs 340 crore and Blinkit’s revenue to grow at CAGR of 51.4 per cent to Rs 2,797 crore.

"We are long-term constructive on the fortunes of Zomato. The industry structure is likely to remain a duopoly of Zomato and Swiggy with limited disruptions from the likes of Amazon and weaker offering propositions from direct ordering companies like DotPe Thrive and ONDC, etc due to limited networks in Indian cities. Coupled with the moats of network effects, branding, last-mile delivery, customer user behaviour (convenience and addiction) and wide geographical reach, we believe that the duopoly is likely to dominate in the visible future," it said.

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