Last Updated on September 18, 2024 by Wenivesh Team
Zomato‘s share price has recently come under pressure following the news of Ant Financial’s decision to sell a significant stake in the company. Ant Financial, through its subsidiary Antfin Singapore, announced plans to divest about 1.54% of its shares in Zomato, valued at approximately $408 million. This move has led to concerns in the market, contributing to a noticeable Zomato share price fall.
Zomato Share Price Fall As Ant Financial Selling Stake
The shares are being sold at a floor price of ₹251.68 per share, which represents a 4.6% discount to Zomato’s last closing price of ₹263.24 on the National Stock Exchange (NSE). This discount is a key factor driving the Zomato share price fall, as investors often react to large sell-offs, especially when they are executed at a discount to the market price.
Before this development, Zomato’s stock had been performing exceptionally well, with its value more than doubling in 2024. The company’s market capitalization was nearing ₹2.5 lakh crore, indicating strong investor confidence. However, the announcement of the stake sale has shaken this confidence, leading to a Zomato share price fall as traders and investors reassess their positions.
Ant Financial’s stake in Zomato was 4.3% as of June 30, 2024. After the sale, this ownership will drop to approximately 2.76%. This strategic divestment comes after Ant Financial had already sold a 2% stake earlier in the year for about ₹2,810 crore. The cumulative effect of these sales has contributed to the ongoing Zomato share price fall, as the market anticipates the impact of reduced holdings by a major stakeholder.
The sale is being facilitated by prominent investment banks, including Goldman Sachs and Morgan Stanley, which indicates a well-structured exit strategy. Despite the recent Zomato share price fall, the company continues to show strong financial performance, with significant growth in net profit, suggesting that this dip may be temporary as long-term investors may see potential in the company’s future.
Overall, the news of Ant Financial’s stake sale has triggered a Zomato share price fall, reflecting the sensitivity of the stock market to large-scale divestments, especially when they involve significant discounts to the prevailing market price.
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