Zomato share price drops around 1% after Alibaba arm Antfin’s stake sale worth ₹5,438.50 crore

Shares of Zomato worth ₹5,438.50 crore were sold in a block deal on August 20,  Moneycontrol reported.  Antfin Singapore Holding, a subsidiary of Alibaba Group, is believed to be the seller.

In the transaction, 21 crore shares, equivalent to a 2.4 per cent stake in the online food delivery giant, changed hands. The deal was executed at a floor price of ₹258 per share, representing a nearly 2 per cent discount compared to the stock's previous closing price.

On August 19, Mint reported that Antfin Singapore Holdings is looking to offload 1.54% stake in Zomato in a block deal valued at $408 million. The shares were to be sold at a floor price of ₹251.68 per share, as per the report.

Following the block deal, Zomato's shares reacted negatively, dropping around 0.97 per cent to ₹259.62 on August 20, at 10:38 am, on the National Stock Exchange.

According to Zomato's most recent shareholding data, Antfin Singapore Holding held a 4.3 per cent stake in the company. The sale triggers a 90-day lock-in period, during which Antfin cannot conduct further equity transactions.

How did Zomato fare?

The stake sale comes shortly after Zomato's impressive quarterly earnings report, which saw net profit surge 126.5 times to ₹253 crore for the April-June quarter, compared to the same period last year. The profit increase was attributed to higher platform fees and improved operational profitability in its quick commerce division, Blinkit.

While the exact parties involved in the transaction were not immediately confirmed, CNBC-TV18 reported on August 19 that Antfin Singapore Holding was looking to offload a 2 per cent stake in Zomato, valuing the sale at approximately $556 million ( ₹4,650 crore).

Zomato's strong quarterly performance and growth prospects in areas like quick commerce have driven bullish price targets, leading to a 20 per cent rise in its shares over the past month.

The stock has also delivered substantial returns to investors, with a 112 per cent gain year-to-date and nearly 200 per cent growth over the past year.