Zomato Receives 'Buy' Rating from MarketsMOJO, Showcasing Strong Growth and Consistent Performance

Zomato, a leading IT software company in the largecap industry, has recently received a 'Buy' rating from MarketsMOJO on August 2, 2024. This upgrade is based on the company's strong long-term growth, with an annual growth rate of 75.50% in Net Sales and 44.57% in Net Profit. In fact, Zomato has declared positive results for the last 11 consecutive quarters, showcasing its consistent performance.
One of the key factors contributing to the 'Buy' rating is the company's high inventory turnover ratio of 137.66 times, indicating efficient management of inventory. Additionally, Zomato has also achieved its highest net sales and PBDIT (Profit Before Depreciation, Interest, and Taxes) in the last quarter, further solidifying its financial performance.

From a technical standpoint, the stock is currently in a bullish range and has shown a 23.51% return since July 9, 2024. Multiple indicators such as MACD, Bollinger Band, DOW, and OBV are also signaling a bullish trend for the stock.

Moreover, Zomato has a high institutional holding of 69.9%, indicating confidence from investors who have better resources to analyze the company's fundamentals. This has also contributed to the stock's market-beating performance in the long term, with a return of 209.13% in the last year and outperforming BSE 500 in the last 3 years, 1 year, and 3 months.

However, there are some risks associated with investing in Zomato. The company has a low Return on Equity (ROE) of 0.86%, indicating poor management efficiency and profitability per unit of shareholders' funds. Additionally, Zomato has a high Debt to EBITDA ratio of -1.00 times, which may affect its ability to service debt in the long term.

Furthermore, the company's operating profit has only grown at an annual rate of 19.15% over the last 5 years, which may be a concern for investors looking for long-term growth. Zomato has also reported losses, resulting in a negative Return on Capital Employed (ROCE).

In conclusion, while Zomato's stock has shown impressive returns in the past year, it is important to consider the risks associated with investing in the company. However, with its strong long-term growth and positive financial performance, Zomato may be a good investment opportunity for those looking for market-beating returns.