Indian new-age tech stocks continued to witness volatility this week too, in line with the trend in the broader market due to inflationary pressure in the US, geopolitical unrest in the Middle East, and weak financial performance of Indian tech majors in Q2 FY24.

Entering the September quarter earnings season, eight out of 18 new-age tech stocks, under Inc42’s coverage, slumped in a range of 1% to over 8% this week, with MapmyIndia emerging as the biggest loser.

Shares of Nykaa, RateGain, EaseMyTrip, Nazara, and ideaForge also declined this week.

However, 10 new-age tech stocks remained resilient and gained in a range of 0.5% to over 11%.

Continuing last week’s momentum, CarTrade Technologies jumped 11.1% on the BSE to emerge as the biggest gainer.

Besides, Paytm and Zomato hit multiple 52-week highs this week. However, Paytm’s overall gain during the week remained muted at 0.5% while Zomato jumped 6.4% on the BSE.

Recently-listed stocks like Yatra (up 10.3%), Zaggle (up 8.3%), and Yudiz (up 5.8%), along with Delhivery (up 3.8%) and DroneAcharya (up 4.6%), continued to show strength.

Embracing the volatility, benchmark indices Nifty 50 and Sensex rose 0.5% to 19,751.05 and 0.44% to 66,282.74, respectively, this week. However, both the indices ended Friday’s trading session in the red.

“Weak global cues and a sharp rise in crude oil prices dampened the market sentiment as banking and technology stocks led the downfall. While the market is already coping with global economic uncertainty, concerns over the flare-up in the Israel-Palestine conflict have been making investors jittery,” opined Amol Athawale, VP of technical research at Kotak Securities.

Meanwhile, Siddhartha Khemka, head of retail research at Motilal Oswal, also said that the conflict between Israel-Hamas and the likelihood of another rate hike by the US Fed has kept investors on the edge.

In the near term, markets would continue to take cues from macroeconomic data and ongoing Q2 results, he said.

However, Khemka noted that the Indian market has shown resilience despite several global headwinds this week.

“We expect markets to remain in a broad range with positive bias on the back of strong economic data along with expected healthy corporate earnings,” he added.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The 18 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $38.74 Bn as against $40.28 Bn last week.

Zomato’s Product Experimentation Continues

After several experiments and pilots carried across new verticals and its main food delivery business, Zomato has now forayed into the logistics business with the launch of Zomato Xtreme.

As per the Xtreme app, the new service aims to simplify the business delivery process from merchants to their valued customers. However, it is not yet clear if the parcel delivery platform will only serve businesses or retail customers as well.

Shares of Zomato gained in four consecutive sessions this week and touched fresh 52-week highs.

Overall, the shares gained 6.4% this week, ending Friday’s trade at INR 111.05, up 1.1% compared to Thursday’s close. 

Meanwhile, Zomato has been slapped with an INR 1 Lakh fine, along with McDonald’s, by the District Consumer Dispute Redressal Forum (II) Jodhpur for alleged wrongful delivery of non-vegetarian food items on a vegetarian order.

Despite a volatile market, retail investors seem to be bullish on the Zomato stock, which has gained more than 87% so far this year.

Prashanth Tapse, senior VP (research) at Mehta Equities said that the stock is currently a “compelling buy” and long positions are recommended with a target of INR 121 to INR 143.

However, many brokerages are of the opinion that Zomato’s food delivery growth in Q2 FY24 could remain muted.

In a research report this week, ICICI Securities said that Zomato’s food delivery gross order value (GOV) is expected to grow 4% sequentially and 14.8% YoY in Q2, while food average order value (AOV) could remain flat sequentially, witnessing a mere 3.2% rise YoY.

“In food delivery, we forecast sequential GOV growth of 4% (+15% YoY) amidst increased competitive intensity,” analysts at JM Financial said.

Zomato’s food delivery business GOV stood at INR 7,318 Cr in Q1 FY24.

Brokerages Bullish On Paytm’s Q2

In their recent research reports, multiple brokerages said that fintech major Paytm is likely to show strong growth in Q2 FY24, like most other payments and fintech players, helped by steady sequential growth in lending.

On the back of an overall positive sentiment in the market, Paytm shares hit new 52-week highs in three consecutive sessions this week.

However, its shares slumped later in the week and the overall gain stood at 0.5% this week. It ended the week in the red at INR 932.9 on the BSE.

Paytm shares could have also been affected by a few other business updates this week.

In The News For:

• Paytm launched the industry’s first alternate ID-based guest checkout solution for merchants.
• The RBI on Thursday slapped the company’s subsidiary Paytm Payments Bank with a penalty of INR 5.39 Cr for non-compliance with KYC norms. 

Paytm is scheduled to report its Q2 FY24 results next week.

Newly-Listed Zaggle’s Bull Run Continues

Fintech SaaS startup Zaggle, which made a muted stock market debut last month, has gained over 45% since its listing. In fact, its shares rallied over 8% this week.

Shares of Zaggle jumped almost 9% on Friday after the company bagged a $20 Mn order from Visa for cobranded forex cards.

Zaggle makes network-agnostic prepaid cards for corporates as rewards and reimbursement vehicles and other fintech SaaS solutions for expense management. 

Its stock ended Friday’s trading session at INR 235.4 on the BSE.

Zaggle listed on the BSE at INR 162 apiece three weeks ago, while its IPO price band was set at INR 156-INR 164 per share.