Zomato shares up nearly 7% as analysts project bigger order volumes

Shares of India’s Zomato surged nearly 7% on Wednesday after several analysts projected higher profits in the near term, recovering some losses from a sharp drop in their value after a share lock-in period ended this week.

Ant Group-backed Zomato made a strong debut on the Mumbai market last year, but concerns about its valuation have brought down its market value by about 68% since then.

“We believe its next phase of growth will be driven by higher ordering frequency from its existing user base,” analysts at Credit Suisse said, adding that low reliance on new customers will minimize customer acquisition costs.