From Paytm To Zomato To Nykaa: Should Investors Grab New-age Stocks On Steep Falls? – Explained!

From Paytm to Zomato to Nykaa: – New-age corporations have been the discuss of the city — at the least in some sections — on Dalal Street, with the itemizing of Zomato in July 2021, and the secondary market debuts of Paytm, Delhivery, MapMyIndia, Policybazaar and Nazara over the subsequent one yr. Not all these corporations are worthwhile but. In reality, many such shares have misplaced greater than 50 per cent of their worth within the final one yr.

Experts are divided on the brand new-age area from an funding perspective, with some even flagging their valuations.

Goldman Sachs has maintained a ‘purchase’ name on Paytm with a Rs 20 improve in its goal value to Rs 1,120 — implying upside potential of 112.7 per cent from the digital funds firm’s closing value on Tuesday.

The inventory of One97 — the guardian firm of Paytm — is but to command a premium over the problem value of its mega IPO, which concluded with an total subscription of 1.9 instances the shares on provide, lesser than the vast majority of major market choices within the bumper yr.

Morgan Stanley has retained an ‘obese’ score on Zomato however diminished its goal value for the inventory by Rs 10 to Rs 82.

The brokerage has additionally saved an ‘obese’ on Delhivery, however introduced down its goal value for the logistics firm’s inventory by Rs 50 to Rs 400.

Not many analysts are satisfied in regards to the prospects of latest-age firm shares.

,”I usually await greater than a yr (after the itemizing to take a name of shopping for,” AK Prabhakar, Head of Research at IDBI Capital Markets, instructed, requested about whether or not he prefers chasing newly-listed new-age corporations.

Prabhakar suggests ready for a number of quarters of earnings earlier than assessing the true price of such corporations.

Let’s check out the returns a number of the new-age shares have given over the previous few months:

Stock  Return (%)  CMP vs difficulty value (%)
One month Six months One yr
Paytm 1.6 -27.9 -46.7 -75.3
Zomato -18.1 -5.7 -60.6 -33
Nykaa -20.9 -44.5 -61.7 -88.5
PB Fintech -7.9 -15.2 -51.8 -54.3
Delhivery -13 -51.6 -42.7 -36.9
Nazara 0.2 2.8 -52.7 -46.4
MapMyIndia -5 -26.1 -38.9 4
Cartrade -6.3 -30.5 -43.8 -71

Anil Singhvi view

Journalpur Business Managing Editor Anil Singhvi stated lately that traders proudly owning shares of latest-age corporations like Nykaa, Policy Bazaar and Zomato ought to maintain on and “avoid selling them at just about any price”, although he stated that the worst seems to be behind on this area.

“If you have missed the opportunity to sell at a high, resist selling it at a low as two wrongs will not make things right,” he stated. (Read extra on Anil Singhvi’s view on new-age shares)

“These companies need to be more realistic… I am not convinced by their cash burning models… I do not understand how they decide valuations. Tech companies are known to get higher valuations but such levels are not justifiable (for new-age companies),” Vijay Chopra of Enoch Ventures instructed Journalpur Business.

Chopra finds Zomato higher than Nykaa from the brand new-age area, on the pretext that the restaurant aggregator is burning much less money than the digital funds agency.

[Disclaimer: This story was automatically generated by a computer program and was not created or edited by Journalpur Staff. Publisher:]

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