InvestorQ : What would you advise an investor to do in the Zomato IPO?
vaishnavi mhatre made post

What would you advise an investor to do in the Zomato IPO?

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vidhya Laxmi answered.
4 months ago
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The question you need to ask about Zomato is not whether it is a great digital business model; which it obviously is. The real question is whether the IPO will leave returns on the table for investors as it will start with a valuation of Rs.60,000 crore. Zomato is facing tough competition in India from Swiggy and the likes of Paytm are getting into everything and even building their own payment ecosystem. Profits must grow really fast to justify price.

While the digital story is still good, most mega IPOs in the past have struggled to live up to expectations. Talk to your advisor, but here is how you should think. If you are looking to participate in a smart digital story from a long-term point perspective you will do good in Zomato. However, a short term view of listing gains may not be that simple. Ideally, my suggestion is that just think through these factors and make a business decision.

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