SoftBank, the Japanese investment giant, is reportedly planning to completely exit the online food delivery platform Zomato in the coming months.
Remaining Stake to be Sold:
Sources indicate that SoftBank, which recently sold nearly 10 crore shares of Zomato constituting 1.17% of the company’s equity, still holds around 2.18% of the stake. This remaining stake is expected to be divested through block deals.
Profitable Investment:
SoftBank had acquired its Zomato stake in June of the previous year for approximately Rs 71 per share. The company has reportedly earned significant profits from this investment. As of now, neither SoftBank nor Zomato has provided official comments on the matter.
Recent Block Sale and Transaction Details:
During a recent transaction, around 10 crore Zomato shares were traded, representing 1.17% of the company’s equity, with a total deal value of approximately Rs 947 crore. It is believed that SoftBank‘s SVF Growth Fund, based in Singapore, was the likely seller in this substantial transaction.
Tiger Global’s Exit and Impact:
This development follows the exit of another foreign institutional investor, Tiger Global Management, which recently offloaded its entire 1.44% shareholding in Zomato. The deal garnered Tiger Global a total of Rs 1,123.85 crore. The shares were sold at an average price of Rs 91.01 per share.
Positive Outlook and Expansion:
Despite these changes in ownership, brokerage firm HSBC has maintained a buy rating on Zomato. Furthermore, the firm has increased its price target for the company from Rs 102 to Rs 120. HSBC‘s analysis suggests that hyperlocal services could potentially drive Zomato’s growth in the long term.
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