Zomato’s flop show raises many important questions
- When times are good investors do not ask the most basic question of where the future earnings are going to come from. But when times change, they do get around to asking this. Something similar has happened to Zomato, which is a loss-making company, still trying to figure out its business model
One year is a long time in the stock market. A hot investment can totally fizzle out during the period. Zomato Ltd. is an excellent example of that. The company listed on the stock exchanges on 23 July last year, after its initial public offering was oversubscribed by more than 38 times, with the retail part subscribed almost 7.5 times and the qualified institutional buyers’ part close to 52 times.