Indian new-age tech stocks witnessed a mixed week, with major block deals pulling down some of them, despite the broader domestic market continuing its rally. Analysts believe that investors are currently following the ‘buy on dips’ strategy in the Indian equity markets.

Ten out of the 24 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.03% to almost 20% on the BSE. 

TBO Tek emerged as the top gainer, with its shares surging 19.8% during the week after Goldman Sachs initiated coverage on it with a ‘buy’ rating and projected a meaningful upside. The shares touched an all-time high at INR 1,938.75 but ended the week at INR 1,903.2, only 3.5% lower than Goldman Sachs’ price target for the stock.

PB Fintech was the second-biggest winner this week, with its shares gaining 4.6% on the BSE. It was followed by Awfis, which gained 4.2%.

Zomato, Nykaa, IndiaMART, ideaForge, Go Digit, Delhivery, and Nazara were the other gainers this week.

On the other hand, TAC Infosec emerged as the biggest loser, as its shares nosedived 13.7%. It was followed by Fino Payments Bank, which fell 11.3%.

Yudiz, ixigo, CarTrade, MapmyIndia, Mamaearth, and RateGain were among the total of 14 new-age tech stocks that declined this week.

Among these, CarTrade saw some major block deals this week as some of its top investors – Highdell Investment, MacRitchie Investments, and JP Morgan’s CMDB II – offloaded shares worth over INR 535 Cr.

MapmyIndia shares also declined amid a block deal initiation announcement by the company’s promoter and founder.

In the broader market, benchmark indices Sensex and Nifty50 gained 2.4% and 2.2%, respectively. After touching fresh all-time highs on Friday (June 28), Sensex ended the week at 79,032.73 and Nifty 50 closed at 24,010.60. 

Speaking about the market sentiment, V K Vijayakumar, chief investment strategist at Geojit Financial Services, said earlier this week that high valuations might prompt selling by foreign institutional investors (FIIs) and profit booking by domestic institutional investors (DIIs), but the exuberant retail investors are likely to buy every dip since the ‘buy on dip strategy’ has worked well in this bull market.

On Friday, Vijayakumar said, “The market momentum has the potential to take the Sensex to 80,000 levels. The healthy trend in the recent rally is that it is driven by fundamentally strong large caps. However, corrections can happen any time since the market is in the overbought zone and DIIs are booking profits.” 

“The elevated valuations in the market continue to be a concern but the market is not yet in bubble valuation territory,” he added.

Meanwhile, the trend of FIIs selling their holdings has also started seeing some reversals.

Siddhartha Khemka, senior group VP, head of research at broking and distribution at Motilal Oswal, expects the positive momentum that the market saw this week to continue at a steady pace with stock-specific action. 

“However, the release of economic data points next week would keep a little volatility in the market,” Khemka added.

Overall, the 24 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $58.42 Bn.

Now, let’s take a deeper look at the performance of the new-age tech stocks in the market.

MapmyIndia Promoter To Pare Stake

Shares of MapmyIndia, which ended last week at a historical highest close of INR 2,532.7, fell 9.12% this week after its promoter and founder Rakesh Verma announced selling 5 Lakh shares of the geotech company in a block deal.

The company said that Verma was selling a part of his stake for philanthropy. However, the shares declined in two consecutive sessions mid-week. The stock ended Friday’s session 2.6% higher at INR 2,301.8 on the BSE.

It is also pertinent to note that brokerage JM Financial started its coverage on MapmyIndia with a ‘buy’ rating and a price target (PT) of INR 2,900, which implies an upside of almost 26% to the stock’s last close.

The brokerage said that its constructive view on the stock is based on a few top-down rationales, including location intelligence as a service (LaaS) becoming ubiquitous across industries and the company’s well-established moats to not only ride the rising adoption trend but also gain market share.

Speaking on MapmyIndia’s performance, Jigar S Patel, senior manager of technical research analyst at Anand Rathi, said that the stock’s support is at INR 2,200.

“Investors can use ‘buy on dips’ strategy for the next week,” said Patel, adding that the trading range is expected to remain between INR 2,200 and INR 2,450 in the near term.

Nazara’s Business Expansion Continue

After a slightly slow start to the week, shares of Nazara jumped almost 7% during Friday’s trading session, ending the week at INR 868.95 on the BSE.

The rally took place after Nazara’s esports subsidiary NODWIN Gaming announced increasing its existing 13.51% stake in Germany-based Freaks 4U Gaming GmbH to 100% in tranches through a share swap valued at INR 271 Cr.

Besides, earlier this week, Nazara’s publishing arm, Nazara Publishing, also entered into a publishing partnership with nCore to publish ‘Made in India’ mobile game FAU-G Domination. The pre-registration of the game will open on Google Play and the App Store later this year.

Overall, the gains for the week were marginal.

It is pertinent to note that after witnessing a sharp slump from the beginning of the year till May, shares of Nazara have witnessed a significant rally over the last one month and have jumped over 41% so far since May 27, after the company published its FY24 earnings.

Anand Rathi’s Patel said that the upside for the stock is seen till INR 935-INR 940, while the support is at INR 800 zone. 

Brokerages More Bullish On Zomato After Swiggy’s 2023 Performance Update

After Prosus published IPO-bound Swiggy’s 2023 operating performance, multiple Indian and international brokerages turned more bullish on Zomato’s market share and performance in food delivery.

For instance, Goldman Sachs said that Zomato now likely holds a 56-57% market share in the food delivery market.

It is to be noted Zomato’s biggest competitor in the food delivery market, Swiggy saw a 26% year-on-year (YoY) increase in gross order value (GOV) in 2023. Its core food-delivery business GOV grew by “double digits”, as per Prosus’ disclosure.

“At a 31% FY24-27 GOV CAGR, Zomato is the fastest growing food delivery company within our global coverage and also one with the highest margin profile,” Goldman Sachs said.

Meanwhile, JM Financial also said in a research note that while Swiggy confidentially filed its pre-DRHP with the SEBI earlier this year, a successful public listing of the company largely hinges on the management’s ability to arrest market share losses in both food delivery and quick commerce businesses. Besides, they will also have to demonstrate a clear path to adjusted EBITDA break-even at a consolidated level for the company.

Emkay, CLSA, and Kotak Institutional Equities also reiterated their ‘buy’ rating on Zomato, with most of them highlighting that the company’s growth is faster than Swiggy’s.

Following the brokerages’ bullish stance, shares of Zomato ended above INR 202 level on Tuesday (June 25) for the first time. However, the stock ended the week at INR 200.35, gaining 3.22% overall during the week.

Anand Rathi’s Patel said INR 205 is a crucial resistance level for the stock. A further upside is possible only above this level, he said, adding that the support is at INR 90.

The post TBO Tek Emerges The Top Gainer In A Mixed Week For New-Age Tech Stocks appeared first on Inc42 Media.

Riding on the back of the rally in the broader market following the return of the NDA government to power, Indian new-age tech stocks witnessed yet another week of gains.

Fifteen of the 23 new-age tech stocks under Inc42’s coverage gained in a range of 0.05% to about 29% this week. MapmyIndia emerged as the biggest gainer this week, with its shares surging 28.89%.

Fino Payments Bank (16.68%), Tracxn (10.47%), Yudiz (5.76%), Zomato (4.24%), and Nykaa (1.52%) were among the other winners this week.

Coworking space provider Awfis reported its first financial results this week since its listing on the exchanges. The startup turned profitable in the fourth quarter of the financial year 2023-24 (FY24), posting a consolidated profit of INR 1.4 Cr. Following this, the stock jumped 9% to INR 543.70 during the intraday trading on Thursday. Eventually, Awfis ended the week 0.92% higher.

On the other hand, DroneAcharya Aerial Innovations emerged as the biggest loser this week. Its shares ended 3.79% lower at INR 149.60 on Friday. 

Among the other losers this week were Paytm (3.20%), PB Fintech (2.81%), and Delhivery (1.91%). 

Meanwhile, this week, online travel aggregator ixigo became the latest new-age tech startup to go public, becoming the 24th stock under Inc42’s coverage.

The startup’s shares were listed at INR 138.10 per share on the NSE, a premium of 48.5% from the issue price of INR 93. Similarly on the BSE, the shares opened at INR 135 apiece, up 45.16% from the issue price.

Following the listing, shares of ixigo continued to gain and ended the week over 25% higher from the listing price at INR 169.18 on the BSE.

In the broader market, benchmark indices Sensex and Nifty50 gained 0.28% and 0.15%, respectively. While Sensex ended the week at 77,209.90, Nifty 50 closed at 23,501.10. 

It is pertinent to note that the stock exchanges were closed on Monday (June 17) on the occasion of Bakri Id. 

Commenting on the market performance, Geojit Financial Services’ research head Vinod Nair said, “With a coalition government in place, there is optimism that the upcoming Budget will strike a balance between growth initiatives and populist measures. Additionally, expectations are high for government actions aimed at stimulating consumption, a critical area to focus on.” 

 Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week.

Overall, the 24 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $54.95 Bn as against 23 stocks ending the last week with a valuation of around $54.94 Bn.

Zomato Gains On Paytm Insider Acquisition Bid

On Sunday (June 16), foodtech major Zomato and fintech Paytm intimated the bourses that they were in discussions for the former to acquire the latter’s events and movie ticketing business, Paytm Insider.

While the companies only said that the discussions were at a preliminary stage, reports pegged the deal size at around INR 1,500 Cr. 

If it materialises, the deal can shore up Zomato’s revenue by bolstering its ticketing and entertainment segment revenue. It will also position the foodtech company as a challenger to BookMyShow.

Buoyed by the acquisition talks, shares of Zomato jumped 4.24% to end the week at INR 194.10 on the BSE. 

Meanwhile, brokerages continue to be bullish on the stock. In a research report this week, JM Financial retained its ‘Buy’ rating for the stock but reduced its price target (PT) for the stock to INR 250, from April’s INR 260. It said that acquisition of Paytm’s ticketing business will strengthen Zomato’s ‘Going-out’ business, 

“The deal could catapult Zomato to second position in the events & movie ticketing space, behind only BookMyShow,” the brokerage added. 

Meanwhile, Bernstein also maintained its ‘Buy’ rating on the stock, along with a PT of INR 230. 

“Zomato is a market leader in key segments it operates in, driven by its solid execution in selected under-penetrated end markets. Going forward, we believe quick commerce which has shown exponential growth — growing over 100% YoY in 2023, will be the most attractive segment from a growth and margin perspective,” Bernstein said in a report.

Paytm Loses Steam 

The fintech giant ended its three-week winning streak, with the stock falling 3.2% this week. The company was in the news for a number of different reasons this week.

• Amidst ongoing layoffs, several ex-Paytm employees have complained to the Ministry of Labour and Employment, alleging “unlawful termination” without compensation. The ex-employees have sought the reinstatement of their employment, alleging unfair and unethical termination by the Paytm management.
• Adding to the top level churn at the company, Paytm’s non-executive independent director Neeraj Arora resigned this week. The company replaced him with former Securities and Exchange Board of India’s (SEBI) whole time member Rajeev Krishnamuralilal Agarwal.
• The series of block deals continued at Paytm this week, with Goldman Sachs (Singapore) PTE selling shares worth INR 183 Cr and Marshall Wace Investment Strategies – Eureka Fund offloading shares worth INR 25 Cr.

While JM Financial remains bullish on Zomato, it gave a ‘Sell’ rating and a price target of INR 300 for Paytm. 

On the potential deal with Zomato, JM Financial’s BFSI analyst Sameer Bhise said that it is in line with Paytm’s stated strategy of focussing on the payments and financial services business.

“Incrementally, cash realisation from this sale should aid Paytm as it reenergises its marketing spends,” he said. 

MapmyIndia Soars To All-Time High

The geotech company’s shares soared to an all-time high of INR 2,745.05 on June 21. Eventually, the stock ended the week nearly 29% higher at INR 2,532.7 on the BSE. 

The sharp rise came on the back of Goldman Sachs initiating its coverage on the stock with a ‘buy’ rating and a price tag of INR 2,800. 

The brokerage highlighted MapmyIndia’s advantageous early market position in high-growth sectors such as automotive navigation, mapping devices, connected vehicles, telematics, and government digitisation.  It also forecasted a CAGR of 38% in the FY24-FY27 period, with a steady EBITDA margin in the 38% to 41% range.

The company reported a 35% increase in its consolidated profit after tax (PAT) in the March quarter of FY24 to INR 38.2 C from INR 28.3 Cr in the same quarter a year ago. Operating revenue grew 47.5% to INR 106.9 Cr from INR 72.4 Cr in Q4 FY23.

The post New-Age Tech Stocks Continue Their Bull Run; MapmyIndia Biggest Gainer This Week appeared first on Inc42 Media.

Riding on the back of the bull run in the broader market sentiment, Indian new-age tech stocks witnessed significant northbound momentum this week.

Eighteen out of the 23 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.1% to over 27%. TAC Infosec emerged as the top gainer, followed by Yudiz. Both the NSE Emerge-listed stocks rallied over 27% during the week.

Among the other gainers were ideaForge (up 13.2%), Paytm (up 11.5%), DroneAcharya (up 11.1%), Awfis (up 8.4%), Nazara, and PB Fintech (both up over 6%).

Meanwhile, following a major block deal, Mamaearth became the biggest loser this week. Its shares fell 2.2%. 

Despite its shares touching an all-time high mid-week following strong FY24 earnings, newly-listed Go Digit also fell 0.3% this week. The insurance tech platform posted over a 400% jump in profit after tax (PAT) to INR 182 Cr FY24 from INR 36 Cr in the previous fiscal year.

The other losers of the week were Tracxn, CarTrade, and MapmyIndia.

In the broader market, benchmark indices Sensex and Nifty50 gained 0.39% and 0.75%, respectively. While Sensex ended the week at an all-time high close at 76,992.77, Nifty50 too ended at a record close at 23,465.60.

Speaking on the market performance this week, Vinod Nair, head of research at Geojit Financial Services, said that the mid and small-cap sectors demonstrated outperformance during the week, on positive sentiment for growth-based stocks. 

Meanwhile, domestic CPI data suggests a gradual decline in inflation, he noted. 

“Though the last mile towards the inflation target remains sticky, given the expectation of a normal monsoon, investors are hopeful that the MPC will be one step closer to the easing cycle,” Nair said. “In the upcoming week, attention will be on the release of industrial production data from India, China, and Eurozone inflation as investors seek insights into the economic outlook of these countries.”

Meanwhile, the US Federal Reserve kept its key interest rate unchanged this week and signalled just one cut before the end of the year.

Prashanth Tapse, senior VP (research) at Mehta Equities, said that as expectations start building up from the government in the run-up to the Budget next month, markets might face bouts of intra-day volatility going ahead.

Next week will also see the listing of another new-age tech stock, ixigo. This week, the traveltech startup’s public issue was oversubscribed 98.34X. 

Now, let’s dive deeper into understanding the performance of the new-age tech stocks this week.

The 23 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $55.2 Bn as against around $54 Bn last week.

Paytm’s Mixed Week

After being under selling pressure for months, shares of fintech major Paytm witnessed a sudden rally this week. The stock gained about 11.5%, ending the week at INR 424.9 on the BSE.

The company’s shares last closed above the INR 400 level at the beginning of April this year.

Though the shares rallied largely on the back of positive developments around restructuring, it was a mixed week for the company. 

In The News For:

• Inc42 learned from multiple sources that Paytm has been asking employees to resign voluntarily or face disciplinary action. Besides, the company is also trying to retrieve various bonuses already paid to the employees. The company has denied the allegations.
• Paytm informed its stakeholders about a few positive developments, including its partnership with Samsung Wallet for flight, bus, movie, and event ticket bookings.
• The Insurance Regulatory and Development Authority of India (IRDAI) has accepted Paytm General Insurance’s registration withdrawal application. Paytm will now focus on the distribution of insurance products of other insurers.

Booking some profit from the share price surge, hedge fund Marshall Wace offloaded 5.85 Lakh shares worth INR 25.08 Cr in the company in a block deal on Friday (June 14). The shares were lapped up by BNP Paribas.

Though Paytm shares gained quite a bit this week, Rupak De, senior technical analyst at LKP Securities, said that currently there is no clear trend emerging from the movement.

De sees support for the stock in INR 420-INR 400 range while he has a bullish stance on Paytm if it crosses INR 440 level. 

Paytm is still trading over 33% lower year to date.

Nykaa’s Growth Projections

Shares of Nykaa continued to trade sideways this week. The stock gained 0.6% overall, ending the week at INR 170.95 on the BSE.

However, on the company’s ‘Annual Investor Day’ on Friday, its shares surged almost 5% to INR 175.15 during intraday trading.

Here are a few key developments from the meeting:

• Nykaa Fashion aims to turn EBITDA positive by the end of the financial year 2025-26 (FY26).
• The company said that it is working to improve its delivery timelines and looking to introduce express delivery service in metro cities.
• Nykaa has projected its beauty business to grow at a CAGR of mid-to-late 20% till FY28 and the fashion vertical to grow to 2.5-3X over the next three years.

On the other hand, Nykaa also announced expanding its ESOP pool size by allocating more than 4.73 Lakh equity shares to its employees. The newly allotted shares are worth over INR 9.72 Cr.

It is pertinent to note that shares of Nykaa have largely witnessed a range-bound movement since the beginning of the year. LKP Securities’ De sees INR 167 as the immediate support for the stock.

He sees a bull case for the stock only after Nykaa closes above INR 174.

Large Block Deal At Mamaearth

Shares of D2C beauty brand Mamaearth were volatile this week. Partially hurt by two large share offloading, the stock fell 2.2% during the week to end at INR 427.65 on the BSE and emerge as the biggest loser.

Its two major pre-IPO shareholders, Fireside Ventures and Sofina Ventures, offloaded 32.42 Lakh shares each in the company worth INR 141.21 Cr and INR 141.06 Cr, respectively.

In the quarter ended March 2024, Fireside held 1.71 Cr shares and Sofina held 1.99 Cr shares in the company.

Following the offloading on Tuesday (June 11), Mamaearth shares fell almost 5% on the day. The next day, its shares fell further.

Meanwhile, the company also announced this week that its partnership with Reliance Retail has taken its store count to 1,000 in Smart Bazaar or Smart Point stores. 

Shares of Mamaearth are currently trading 2.9% lower year to date.

The post New-Age Tech Stocks Rally On Bull Run In Broader Market; Mamaearth Biggest Loser This Week appeared first on Inc42 Media.

The Indian new-age tech stocks witnessed significant volatility this week, in line with the broader market trends as projection of exit polls and then Lok Sabha election results dictated investor sentiment at the beginning of the week.

After a slump on the vote counting day on Tuesday (June 4), 17 out of the 23 new-age stocks under Inc42’s coverage gained this week in a range of 0.3% to over 15%.

Nazara Technologies emerged as the biggest gainer, with its shares rallying 15.5%. It was followed by three newly-listed startups – Go Digit (up 13.7%), Awfis (up 11.3%), and TBO Tek (up 8.2%).

Paytm, Tracxn, IndiaMART, RateGain, Zomato, and DroneAcharya were among the other gainers this week.

However, shares of PB Fintech, EaseMyTrip, and Yatra declined marginally this week. Meanwhile, Mamaearth fell 1.3%, CarTrade declined 5.5%, and Yudiz slumped 10.4%.

In the broader market, benchmark indices Sensex and Nifty50 shot up over 3% on Monday on the exit polls results indicating a comfortable majority for the Prime Minister Narendra Modi-led National Democratic Alliance (NDA). However, on Tuesday, both the indices slumped almost 6% as the ruling Bharatiya Janata Party (BJP) fell short of the majority mark.

However, in the last three trading sessions of the week, the market revived again as the BJP and its alliance parties together are set to form the government. Overall, Sensex gained 3.69% this week, ending at 76,693.36 and Nifty50 gained 3.37% ending at 23,290.15.

Siddhartha Khemka, head of retail research at Motilal Oswal, said that strong domestic economic data, falling oil prices, and NDA unanimously passing a resolution to elect PM Modi as the leader of the coalition has uplifted investor confidence. 

It must be noted that the Reserve Bank of India (RBI) this week raised the country’s GDP growth forecast for FY25 to 7.2% from 7% earlier.

“Global cues added to the positivity with the European Central Bank announcing interest rate cut by 25 bps for the first time in nearly five years, moving faster than its US and UK counterparts. Now hopes have revived that the US Fed might cut interest rate in the September meet, based on recent macro data points,” he said.

“Next week, the focus will be on the allocation of key cabinet portfolios such as finance, defence, roads, energy, commerce, and railways ministries. The market will continue to be volatile with upward bias,” added Khemka.

Meanwhile, the INR 740 Cr IPO of traveltech startup ixigo is opening for subscription next week.

Now, let’s take a deeper look at the performance of the new-age tech stocks this week.

The 23 new-age tech stocks under Inc42’s coverage ended the week with a total market capitalisation of $54.01 Bn as against $52.3 Bn last week.

Nazara Emerges As The Biggest Gainer

Shares of Nazara rallied 15.5% this week, despite a 14% decline on Tuesday, to close at INR 811 on the BSE – a level last seen towards the end of February this year.

The stock has been on an upward trend since Nazara posted its Q4 FY24 earnings two weeks ago. Though its profit declined in Q4, certain metrics in its results were better than expected by analysts. 

Besides, Nazara also increased its stake in Nextwave Multimedia Private Limited, the developer of mobile cricket game franchise World Cricket Championship, to 100% by acquiring an additional 28.12% stake.

Meanwhile, this week, its subsidiary Absolute Sports announced the US market foray by acquiring Pennsylvania-based entertainment news site Soap Central for $1.4 Mn (around INR 11.6 Cr) in an all-cash deal.

Shares of Nazara started gaining strength after a slump at the beginning of this year. The stock is still trading 5.3% lower year to date (YTD).

PB Fintech CEO Gets SEBI Show Cause Notice

CEO and chairperson of PB Fintech Yashish Dahiya received a show cause notice from the markets regulator Securities and Exchange Board of India (SEBI) on Thursday (June 6). 

The show cause notice is regarding a $2 Mn investment made by PB Fintech FZ-LLC, Dubai in outsourced marketing services provider YKNP Marketing Management in November 2022 to acquire a 26.72% stake.

Meanwhile, Tencent Cloud Europe B.V. also offloaded 33 Lakh shares in the company on Thursday in a bulk deal worth INR 415.7 Cr.

Shares of PB Fintech, which had started gaining upward momentum after Tuesday’s market slump, fell again in two consecutive trading sessions on Thursday and Friday. The stock ended the week 0.07% lower at INR 1,288.05 on the BSE.

The stock rallied significantly since the beginning of the year and is currently trading 62.2% higher YTD.

Zomato-Owned Blinkit’s Warehouse Raided

A warehouse of Zomato’s quick commerce platform Blinkit was raised by the Telangana food safety department this week in the state’s Medchal Malkajgiri district. The task force found the premises to be “disorganised, unhygienic and dusty”.

Several packets of expired food products were also found in the raid.

On the other hand, amid the severe heat wave in several parts of the country, Zomato urged its users to avoid placing delivery orders during the peak afternoon, which also sparked a major debate across social media platforms.

Shares of Zomato have recently lost their upward momentum after touching INR 200 level in May. The recent decline was partially also triggered by brokerage Macquarie reiterating its ‘underperform’ rating on the stock and a price target of INR 96.

Despite volatility, Zomato ended the week 2.9% higher at INR 184.05 on the BSE.

The post New-Age Tech Stocks Rally In Volatile Election Result Week, Nazara Emerges Top Gainer appeared first on Inc42 Media.

Continuing the slump of the previous week, new-age tech stocks witnessed a bearish market sentiment this week as well. Most of these stocks declined in line with the broader market, which came under pressure as the Lok Sabha elections entered the last phase.

Only five of the 22 new-age tech stocks under Inc42’s coverage gained this week in a range of 1% to about 15%. 

The top gainer of the week was gaming major Nazara Technologies, which surged 14.23%. Last week, the company reported a sharp decline in its profit in the fourth quarter of the financial year 2023-24 (FY24). 

Paytm’s parent One 97 Communications Ltd, D2C unicorn Mamaearth’s parent Honasa Consumer, recently-listed B2B travel portal TBO Tek or Travel Boutique Online, and fintech major PB Fintech were the other gainers this week.  

On the other hand, 18 startups saw a decline in the range of 0.4% to 23%. Last week’s top gainer Zaggle, Nykaa’s parent FSN E-Commerce Ventures, TAC Infosec, and DroneAcharya were among the biggest losers this week. 

It is pertinent to note that besides Nazara, the week saw DroneAcharya, TBO Tek, TAC Infosec, Yatra, and Yudiz declare their financial results for the March quarter of FY24. 

The biggest loser this week was blockchain and IT development company Yudiz Solutions. Its shares plummeted about 23% week-on-week to INR 59.30 on the NSE on May 31. The company slipped into the red in FY24 with a net loss of INR 2.9 Cr.

Meanwhile, coworking space provider Awfis made a strong market debut on the BSE and the NSE on May 30.

Awfis’ shares listed at INR 432.25 on the BSE, 12.8% higher than the issue price of INR 383. Similarly, on the NSE, the startup’s shares listed 13.5% higher than the issue price at INR 435 apiece. However, the stock closed the week at INR 402.5 on the BSE. 

Meanwhile, benchmark indices Sensex and Nifty50 fell about 1% each to close the week at 73,961.31 and 22,530.70, respectively. Market experts attributed this decline to “election-related nervousness”. 

“Due to the lack of positive triggers, the bulls faced resistance at higher levels, leading to profit booking across the sector. The caution ahead of the exit poll results… prompted market participants to sideline riskier assets. However, investors are adjusting their portfolios to align with fundamentally strong sectors and stocks, as robust Q4 FY24 earnings and better-than-expected Q4FY24 GDP growth will continue to provide a buffer on valuation in the medium term,” he said. 

On Friday, government data showed that the country’s gross domestic product (GDP) grew 8.2% in FY24. The GDP grew by 7.8% in the fourth quarter of FY24.

Meanwhile, the marathon seven-phase Lok Sabha elections concluded on Saturday (June 1). Following the final phase of voting, almost all the exit polls projected a comfortable majority for the Prime Minister Narendra Modi-led National Democratic Alliance (NDA).

The results for the general elections will be announced on Tuesday (June 4).

Now, let’s take a deeper look at the performance of the new-age tech stocks this week.

The 23 new-age tech stocks under Inc42’s coverage (with Awfis being the latest addition) ended the week with a total market capitalisation of $52.3 Bn as against 22 of them ending the previous week at $53.1 Bn.

Signs Of Revival For Paytm?

Reversing the downward trend, shares of fintech major Paytm gained 5.94% this week. 

The Vijay Shekhar Sharma-led company’s shares hit the upper circuit twice this week. 

In The News For:

• The fintech giant has aborted its plans to foray into the insurance space by pulling back its application for a general insurance licence. 
• The company denied a report which said that Paytm was in talks with the Adani Group for the latter to acquire a stake in the former. 
• Amid a top-level exodus, Paytm’s chief human resources officer (CHRO) Swati Rustagi is now quitting the startup.

Last month, Paytm reported a net loss of INR 550.5 Cr in Q4 FY24, more than 3X from the INR 167.5 Cr loss it reported in the year-ago period.

Brokerage firm YES Securities’ has a ‘buy’ rating on Paytm, with a price target (PT) of INR 450. 

“After being under pressure, the merchant payments business started to grow in April and May. On the other hand, monthly transacting users, which drive consumer payments business, are down 25% compared with January. April was the worst month for MTUs but this has stabilised in May. MTU growth will happen once the TPAP commencement happens,” it said.

Meanwhile, Motilal Oswal retained its ‘Neutral’ rating on the stock after the Q4 results. It has a PT of INR 400. 

Nazara Gains Despite Poor Q4 Show

Nazara was the biggest gainer this week despite a sharp decline in its profit in Q4 FY24. The gaming major reported a steep 98% YoY decline in net profit to INR 18 Lakh in Q4 from INR 9.4 Cr in the year-ago quarter. The decline in the company’s profit was due to the INR 11.37 Cr charges it incurred due to goodwill impairments, along with an INR 10.56 Cr dent for intangible assets related to the gaming segment during Q4.

Operating revenue also declined 8% year-on-year (YoY) to INR 266.2 Cr in Q4 FY24 from INR 289.3 Cr in the same quarter a year ago.

Besides the poor financial performance, its promoter Mitter Infotech also sold 48.84 Lakh shares, or 6.38% stake, to Plutus Wealth Management in an on-market block deal. 

Brokerage firm ICICI Securities maintained its ‘Buy’ rating on the stock, with a PT of INR 1,080. This is a 53% upside from the stock’s last close of INR 702. 

“In Q4FY24 Nazara beat I-sec margin estimates given 729 bps QoQ improvement in Nodwin EBITDA margin… At current valuation (23x one-year forward ex minority EV/EBITDA), we believe Nazara is a compelling BUY,” the brokerage firm said.

PB Fintech Gains On MSCI Index Inclusion

Despite falling in three consecutive sessions at the start of the week, shares of PB Fintech gained nearly 1.6% this week. The stock surged nearly 9% during the last trading session of the week on PB Fintech’s addition to the MSCI Global Standard Index, which was to come into effect from the close of May 31.

In The News For

• On Monday (May 27), the company said that it successfully acquired 100% stake in UAE-based insurance broker Genesis Group
• The company approved the allotment of 48.3 Lakh shares of employee stock option plan (ESOP)
• Last month, the company’s CEO Yashish Dahiya and vice chairman Alok Bansal offloaded more than 83.7 Lakh shares via open market transactions for INR 1,109 Cr ($132 Mn). 

PB Fintech reported a consolidated net profit of INR 60.2 Cr in Q4 FY24 against a loss of INR 9.3 Cr in the previous year’s quarter.

The post New-Age Tech Stocks Continue To Bleed; Nazara Biggest Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks witnessed a southbound movement this week amid less than impressive financial performances of some listed companies in Q4 FY24. 

Only four of the 22 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.15% to about 9%. 

Zaggle emerged as the top gainer with shares rallying 8.8% this week on the back of an impressive financial performance in the last quarter of FY24. The fintech SaaS startup posted a more than 153% jump in its profit after tax (PAT) to INR 19.2 Cr in Q4.

The other three gainers this week were Mamaearth, Fino Payments Bank, and ideaForge. 

The shares of 18 tech stocks slipped, in a range of 0.7% to 18.5% during the week. The names included last week’s top gainer PB fintech, Paytm, Nykaa, and TAC Infosec. TAC Infosec turned out to be the biggest loser with shares falling 18.54% on the NSE. 

Paytm and Nykaa also reported their respective Q4 performances this week.

Amid the bearish market sentiment, insurance tech unicorn Go Digit also made an underwhelming public market debut this week. Its shares were listed at INR 286 per share on NSE, a 5.1% premium to the issue price of INR 272. Its shares were listed at INR 281 on the BSEat a meagre 3.3% premium. 

Brokerage firm Emkay initiated its coverage on the startup’s shares, giving it a ‘sell’ rating price target (PT) of INR 210. Besides Digit, coworking startup Awfis is also expected to list within this month. It closed its public issue on Friday (May 24) with an oversubscription of 11.4X. The startup received bids for 9.84 Cr shares as against the 86.29 Lakh shares on offer.

The sentiment towards new-age tech stocks this week was stark opposite to the broader equity market. Benchmark indices Sensex and Nifty50 increased 1.8% and 2.1%, respectively. While Sensex ended the week at 75,410.39, Nifty50 ended at 22,957.1. 

Commenting on the market performance, Vinod Nair, head of research at Geojit Financial Services said that the domestic market gains are opposite to global market sentiments, which remained subdued due to the continued hawkish stance on policy rates.

“The domestic market is reaching new highs, with large caps playing second fiddle to the broader market rally, indicating sustained momentum in the short term. The BSE PSU index has experienced significant rerating due to strong performance and improved visibility, driven by PSU banks and defence stocks,” said Nair.

It is pertinent to note that the bourses this week were closed on Monday (May 20) due to on account of the ongoing General Elections voting day in Mumbai. 

Against this backdrop, here’s a deeper look at the performance of some of the new-age tech stocks this week.

The 22 new-age tech stocks ended this week with a total market capitalisation of $59.56 Bn as against 21 of them ending the previous week at $51.35 Bn.

Paytm Continues To Bleed

Shares of the fintech major shrunk 3% on the BSE this week, ending the last trading session at INR 340.95. The decline is owed to the company announcing a heavy dent in its financial performance earlier this week. 

In The News For:

•  Paytm’s net loss widened over 3X on a year-on-year (YoY) basis to INR 550.5 Cr in Q4 FY24 from INR 167.5 Cr reported in the year-ago period. Its revenue from operations also decreased 2.9% YoY to INR 2,267.10 Cr, compared to INR 2,334 Cr in the same period last year.
• The company informed the bourses that its merchant business saw higher attrition in February and March when Paytm was forced to transition its merchants from its payments bank to other bank partners. This led to its active point of sale device base plummeting by 10 Lakh despite a marginal increase in the merchant base.
• Observing industry-wide decline in asset quality, the Vijay Shekhar Sharma-led company paused its small personal loans business as well as completely shutting its Postpaid portfolio. The company also reported a 36% YoY decline and a steeper 50% sequential decline in its financial service arm revenue which stood at INR 304 Cr revenue. 

Despite the flailing condition of the stock, analysts are of a mixed view towards the startup’s shares. Brokerage firm YES Securities gave the fintech major’s shares a ‘buy’ rating along with a PT of INR 450, observing some upturn in its payments business. 

“After being under pressure, the merchant payments business started to grow in April and May. On the other hand, monthly transacting users, which drive consumer payments business, are down 25% compared with January. April was the worst month for MTUs but this has stabilised in May. MTU growth will happen once the TPAP commencement happens,” it said.

However, Ganesh Dongre, senior manager of technical research, Anand Rathi, anticipates the startup’s stock to reach INR 328-INR 330 level in the upcoming days. 

“Currently, we don’t recommend a buy in this counter because there are possibilities of the shares going down from the current level,” he said. 

Mamaearth’s First Profitable Fiscal Attracts Investors

With a positive outlook from its financials, Mamaearth’s parent Honasa Consumers shares zoomed about 6% this week to close Friday’s trading at INR 430.50 on the BSE.

For the fiscal year, it reported a net profit of INR 110.5 Cr as against the INR 150.96 Cr loss it incurred in FY23. Similarly, operating revenue for the entire fiscal also jumped 30% to INR 1,919.6 Cr in the year ended March 2024 from FY23’s INR 1,492 Cr.

It also posted a net profit of INR 30.47 Cr Cr in Q4, a 17% sequential increase from the previous quarter’s INR 28.91 Cr.

Brokerage firms turned bullish over the startup’s shares post the financial disclosure. While JM Financials, Kotak Institutional Equities, and Emkay maintained a ‘buy’ rating on the stock and gave it a PT of INR 505, INR 450, and INR 500 respectively.

Brokerages expect the company to bank on its “house of brands” strategy moving forward. Kotak highlighted that although its flagship brand Mamaearth’s growth decelerated to 6-7% in FY24, there was a “nice heavy lifting by the younger brands.” 

“Honasa would be able to replicate Mamaearth’s success with some of its other brands which should aid overall revenue performance, enable it to extract savings across lines and drive profitability,” JM Financials said.

Anand Rathi’s Dongre said that he wouldn’t recommend a buy on Mamaearth as there are possibilities of some correction towards the INR 390 level.

Nykaa’s Q4 Results Fail To Excite The Market

With a lukewarm performance in the final quarter of FY24, Nykaa’s share price declined 4.87%, standing at INR 168.15 by the end of the week. 

Nykaa’s consolidated net profit plunged by 48% on a quarter-on-quarter (QoQ) basis to INR 9.07 Cr from Q3 FY24’s INR 17.45 Cr. Its operating revenue also declined 6% on a sequential basis to INR 1,667.9 Cr from the previous quarter’s INR 1,788.8 Cr.

Brokerage firms hold mixed feelings for the shares of the Falguni Nayar-led brand. 

JM Financial reiterated its ‘buy’ rating on the stock and increased the target price for Nykaa to INR 220 apiece from INR 210 earlier. 

“Overpowering the recent discretionary spending slowdown, Nykaa reported robust 30%/27%/68% YoY growth in BPC/Fashion/Others segments… [The] company reported strong operating metrics across transacting users, conversion and AOVs, indicating rising business momentum. We reiterate a ‘buy’ rating with a TP of INR 220,” it said in a note.

However, ICICI Securities downgraded the Nykaa stock to a ‘hold’, while maintaining a price target of INR 175. The homegrown brokerage cited margin concerns and growing competition from other players in the space as the reason for this. 

“While the revenue growth trajectory is improving, ad revenue growth (as a proportion of GMV) remains muted. Also, increasing competitive intensity from other channels/players and its potential impact on margin remains unclear at this point,” ICICI Securities said in a note.

Anand Rathi’s Dongre said that some more correction is expected in this counter till the INR 150 level.

The post New-Age Tech Stocks Slump This Week But Zaggle Emerges As The Biggest Gainer appeared first on Inc42 Media.

The Indian new-age tech stocks witnessed a mixed performance this week as multiple factors, including a revival in the broader equity market, strong Q4 FY24 performance of a few startups and stock-specific developments, led to variations in trading.

Ten out of the 20 new-age tech stocks under Inc42’s coverage this week gained in a range of 0.9% to over 13%. PB Fintech emerged as the top gainer with shares up 13.3% this week.

Among the other gainers were MapmyIndia, RateGain, EaseMyTrip and ideaForge. We must note that this week drone startup ideaForge posted a 30% decline in its consolidated profit after tax (PAT) to INR 10.3 Cr in the March quarter.

On the other hand, 10 others, including Paytm, Fino Payments Bank, Zomato, Mamaearth, Delhivery and TAC Infosec saw a southbound movement this week in a range of 1.5% to 5.2%.

Mamaearth turned out to be the biggest loser with shares falling 5.2% on the BSE.

Both Zomato and Delhivery also reported their respective Q4 performances this week.

Meanwhile, there is a new entrant among the new-age tech stocks. B2B travel portal Travel Boutique Online or TBO Tek made a strong public market debut this week. Its shares were listed at a 55% premium, at INR 1,426, on the NSE and a 50% premium, at INR 1,380, on the BSE.

At least two more new-age tech startups are expected to get listed this month. 

Insurtech unicorn Go Digit General Insurance’s (Digit) is set to get listed on May 23. Its public issue was subscribed 9.6X on the final day of its bidding on May 17. 

On the other hand, coworking startup Awfis’ public issue will open for bidding on May 22. It has set a price band of INR 364-INR 383 for its upcoming INR 599 Cr IPO.

This week, the Indian stock market had a special trading session on Saturday (May 18). 

In the broader market, benchmark indices Sensex and Nifty50 increased 1.85% and 2.03%, respectively. While Sensex ended the week at 74,005.94, Nifty50 ended at 22,502. 

Commenting on the market performance, Vinod Nair, head of research at Geojit Financial Services, said that the domestic market sustained its recovery momentum from the recent lows, primarily helped by positive signals from its global counterparts and better-than-anticipated earnings from index heavyweights. 

“The broader market remained positive, driven by persistent buying in heavyweight sectoral stocks. Furthermore, a moderation in India’s CPI and lower-than-expected inflation figures from the US Fed have stimulated investor confidence,” he said. 

Despite favourable global cues, there are still uncertainties around upcoming general election results. Amid this, analysts expect volatility to continue in the market.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The 21 new-age tech stocks ended this week with a total market capitalisation of $51.35 Bn as against 20 of them ending the previous week at $49.02 Bn.

Zomato Slumps Despite A Strong Q4

Shares of foodtech major Zomato fell 3.4% on the BSE this week, ending the last trading session at INR 194.35.

In The News For:

• Zomato’s consolidated PAT jumped 26.8% quarter-on-quarter (QoQ) to INR 175 Cr in Q4 while operating revenue increased over 8% to INR 3,562 Cr. Its quick commerce business Blinkit turned adjusted EBITDA positive in the month of March 2024. 
• Blinkit is emerging as a stronger business of Zomato over its core food delivery vertical. The quick commerce arm’s operating revenue zoomed 112% YoY and 19% QoQ to INR 769 Cr in Q4.
• Meanwhile, Zomato is aiming to expand and scale its home-cooked meal service ‘Zomato Everyday’ in Bengaluru and Mumbai.
• The company disclosed that it has voluntarily surrendered the certificate of authorisation it obtained from the Reserve Bank of India (RBI) to operate as an online payment aggregator.
• Zomato is also expanding its priority delivery offering to more cities like Delhi, Hyderabad and Pune. 
• The company has also sought approval from its shareholders for the formulation, adoption and implementation of a new employee stock option plan, Zomato ESOP 2024, to grant 18.26 Cr employee stock options.

Following the Q4 FY24 earnings announcement, a few brokerages increased their price targets (PTs) on Zomato. Bernstein increased the PT to INR 230 from INR 200 on the back of the strong Blinkit growth expectations.

The brokerage expects Blinkit to grow more than 40% YoY.

Nuvama hiked its PT on Zomato to INR 245 from INR 180 earlier. “We anticipate the aggressive addition of dark stores to hurt margin expansion for Blinkit in the next two quarters, but this effect is expected to be more than offset by higher margins in FY26,” the brokerage noted.

Elara Capital also hiked its PT on the stock to INR 280 from INR 250 earlier.

However, Kotak Institutional Equities cut its fair value on Zomato to INR 225 from INR 230 earlier.

“We like the company for sharp execution across verticals,” said the brokerage. “Weak demand for Zomato’s services and higher competitive intensity are key risks to our call.”

Delhivery Slips Into Loss In Q4

Ahead of its Q4 earnings announcement on Friday (May 17), shares of Delhivery ended the day’s trading session 0.8% higher at INR 453.85 on the BSE. 

However, the shares slumped almost 4% during Saturday’s trading session, ending the week at INR 435.9.

In The News For:

• After reporting its maiden profitable quarter in Q3 FY24, Delhivery slipped into losses in Q4 with a consolidated net loss of INR 69 Cr. 
• Its top line was hurt by a decline in its express parcel and cross-border services during the quarter, which the company attributed to a fall in shipment volume due to a softness in ecommerce demand and to the Chinese New Year, respectively.
• The logistics unicorn announced its setting up a wholly-owned subsidiary, Delhivery Robotics India, to manufacture drones and provide freight air transportation services.
• Its executive director and chief business officer Sandeep Kumar Barasia resigned.
• Delhivery also announced the allotment of 75,000 stock options under its Employee Stock Option Plan (ESOP) 2012.

Overall, the shares of Delhivery fell almost 3.8% this week hurt by its Q4 performance update.

PB Fintech Emerges As The Biggest Gainer

Reversing last week’s sharp decline, shares of PB Fintech rallied 13.3% this week, closing at INR 1,359.7 on the BSE on Saturday.

We must note that last week the parent entity of insurtech major Policybazaar posted a 62% QoQ jump in its consolidated net profit to INR 60.2 Cr in the March quarter. Post the sharp rally this week, the market cap of PB Fintech also crossed the $7 Bn mark.

On the back of its rising market value, PB Fintech also got added to the MSCI India Index in the May review.

Top executives of the fintech major – Yashish Dahiya and Alok Bansal – sold 83.7 Lakh shares in the company via block or bulk deals.

The offloaded shares were lapped up by several institutional investors, including multiple funds of HSBC, Axis Mutual Fund, and HDFC, BNP Paribas Arbitrage, and Goldman Sachs.

The shares of PB Fintech are currently trading at a level last seen in mid-November 2021, just post its listing.

Following the company’s strong Q4 show, ICICI Securities hiked its PT on PB Fintech to INR 1,311 from INR 818 earlier.

“The moat of the platform has been well established in FY24, having grown more than the industry in key segments (health/life) along with important client wins. Ability to gain market share, expansion of client base and growth in registered customers are structural advantages,” said the brokerage.

Overall, its shares have gained over 71% year to date.

The post Mixed Week For New-Age Tech Stocks; PB Fintech Top Gainer appeared first on Inc42 Media.

Indian new-age tech stocks nosedived this week on the back of a slump in the broader equity market amid worries about the outcome of the 2024 general elections.

Seventeen out of the 20 new-age tech stocks under Inc42’s coverage fell this week in a range of 0.8% to 9% on the BSE, with MapmyIndia emerging as the biggest loser with an 8.8% fall.

Shares of EaseMyTrip and PB Fintech fell over 7% each, Zaggle declined 6.2%, while DroneAcharya, Paytm, and Tracxn slumped over 5% each on the BSE.

Nazara, Yudiz, Yatra, Nykaa, and ideaForge were also among the losers this week. Recently-listed TAC Infosec also reversed its three-week streak of emerging as the top gainer among the new-age tech stocks, as it fell about 1% on the NSE this week.

Meanwhile, helped by strong quarterly results, CarTrade emerged as the top gainer as its shares jumped 24.5% on the BSE during the week. Mamaearth and Zomato were the two other gainers, with their shares training 2% each.

In the broader market, benchmark indices Sensex and Nifty50 slumped 1.64% and 1.87%, respectively. However, after falling sharply in four trading sessions during the week, the indices gained marginally on Friday. Sensex closed at 72,664.47 and Nifty50 at 22,055.20.

Vinod Nair, head of research at Geojit Financial Services said that the Indian markets largely exhibited a downward trend throughout the week. He said this signals that investors are opting to sell after rallies.

“This inclination stems from the domestic market’s premium valuation and concerns surrounding the elections due to a lower voter turnout,” he said.

He also said that despite Q4 domestic earnings largely meeting expectations, there is a noticeable moderation in the overall earnings landscape.

“We expect the current trend in the domestic markets to continue in the short term due to election-led uncertainties. In the data-hectic week ahead, investor attention will be focused on the release of India and the US CPI data, Europe and Japan’s GDP releases, and the Fed chair speech,” Nair added.

Mahavir Lunawat, MD of Pantomath Capital Advisors, also said that the market will remain volatile due to pre-election jitters, geopolitical tensions, global economic slowdown, and delay in interest rate cuts.

Interestingly, despite the current volatility and selling pressure, the domestic IPO market is seeing a lot of action. Two more new-age tech stocks are getting ready to list on the stock exchanges soon.

The IPO of B2B travel portal Travel Boutique Online or TBO Tek, which opened earlier this week, closed with 86.7X subscription. On the other hand, insurance tech unicorn Digit Insurance is launching its INR 2,600 Cr+ public issue next week on May 15. The startup is aiming to list on exchanges on May 23.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The 20 new-age tech stocks ended this week with a total market capitalisation of $49.02 Bn.

CarTrade’s Strong Q4 Show

Shares of CarTrade rallied over 24% this week as the company reported a profit after tax (PAT) of INR 25 Cr in Q4 FY24 against a loss of INR 23.5 Cr in Q3 FY24. 

The company’s shares rose sharply in three consecutive sessions and also touched a 52-week high of INR 974 on Wednesday (May 8). 

CarTrade ended the week at INR 933 on the BSE, closing at the highest level since December 2021.

With the fundamentals improving again, Goldman Sachs Asset Management BV increased its stake in the startup to 5.15% this week, becoming a substantial shareholder. 

Reiterating its ‘buy’ rating on the stock and target price of INR 1,020, JM Financial said the company is perfectly positioned to benefit from rising digitalisation in the Indian auto sector. 

“We expect India’s used items (including used auto) market to grow strongly with consumers rising over the taboo of owning a used item. OLX, being the undisputed market leader, is expected to deliver 18-22% revenue growth along with sustained market expansion,” said the brokerage.

Rupak De, senior technical analyst at LKP Securities, said, CarTrade is looking strong on the charts. The stock might move towards INR 1,000 mark in the near term. The support for the stock is at INR 900.

No Relief For Paytm

Shares of Paytm continued to remain under significant selling pressure following top-level exits in the company last week. 

The stock touched an all-time low this week at INR 310 on the BSE on Thursday (May 9). However, it slightly recovered and jumped 5% on Friday, ending the week at INR 349.95.

Overall, it fell 5.5% this week.

In The News For:

• Exit of Paytm COO and president Bhavesh Gupta last week 
• Paytm Payments Bank (PPBL) moving its bill payment operations to Euronet Services India
• Paytm denying an ET report that claimed Aditya Birla Finance invoked loan guarantees which the fintech major had provided to the lender in lieu of repayment defaults from customers
• Paytm’s plans to venture into the ride-hailing space by offering auto rickshaw booking services through the ONDC

Shares of Paytm have more than halved since the beginning of February after the Reserve Bank of India (RBI) announced a number of restrictions on Paytm Payments Bank. 

LKP’s De said that Paytm remains a ‘sell on rally’ stock. “… sellers will return at higher levels. On the other hand, a short-term trader might consider buying this stock with a stop loss at INR 334 for an upside target of 368-390,” he added.

PB Fintech’s Q4 Results Fail To Excite The Market

The parent of Policybazaar and Paisabazaar reported a net profit of INR 60.2 Cr in Q4 compared to a loss of INR 9.3 Cr in the year-ago quarter. On a quarter-on-quarter (QoQ) basis, PB Fintech’s profit jumped almost 62%.

Its operating revenue increased 25% on both QoQ and YoY basis to INR 1,089.6 Cr in the reported quarter.

Despite reporting a strong quarter, shares of PB Fintech fell sharply this week. Overall, the stock plummeted 7.1%, ending the week at INR 1,201.45  on the BSE.

LKP’s De said that the stock looks weak on the technical charts and might fall towards INR 1,150-INR 1,100 levels. It will face resistance at INR 1,240.

Shares of PB Fintech have gained over 51% year to date.

The post New-Age Tech Stocks Slump In Line With The Broader Market, CarTrade Biggest Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks witnessed mixed performance this week as the broader market also remained volatile amid global political tension and FIIs continued to sell domestic shares.

We must note that the Volatility Index India (VIX) rose sharply over 8% on Friday (May 3), indicating significant volatility and cautiousness in the market. 

Eight out of the 20 new-age tech stocks under Inc42’s coverage increased this week in a range of 0.9% to 27%, with TAC Infosec emerging as the biggest gainer for the third straight week.

In early April, the stock got listed at INR 290 on the NSE Emerge and has rallied over 116% since then, currently trading at INR 626.75.

On the other hand, following its Q4 FY24 earnings, shares of IndiaMart InterMESH rallied 6.3% on the BSE, becoming the second biggest gainer.

Other gainers of the week were Zomato, PB Fintech, CarTrade, Tracxn, ideaForge and Nazara.

Meanwhile, DroneAcharya turned out to be the biggest loser this week by falling 6.4%, followed by RateGain, which declined 5.6%.

Shares of Yatra, Nykaa and Mamaearth fell over 2% this week while EaseMyTrip, MapmyIndia, Yudiz, Paytm and Fino Payments Bank fell 1% or higher.

In the broader market, benchmark indices Sensex and Nifty50 gained 0.2% and 0.25%, respectively. 

While Sensex ended Friday’s trading session at 73,878.15, down almost 1% compared to Thursday’s close, Nifty ended the week at 22,475.85, down almost 0.8% compared to Thursday’s close.

Speaking on the week’s market trend, Prashanth Tapse, senior VP (research) at Mehta Equities, said, “I feel geopolitical tension would make headlines again giving traders an option to go short on markets.” 

“Overall, Q4 earnings are neutral to positive and not so impressive. There are few reports which suggest that FIIs have reduced holding in large caps stocks like HDFC Bank and ITC. For the short term, the trend remains cautious and the focus would be on fresh geopolitical headlines, he said, adding that the brokerage would advise traders to remain light on positions.

Meanwhile, Siddhartha Khemka, head of retail research at Motilal Oswal expects the market to now consolidate in a broader range and the base to gradually shift higher. 

“On Monday, markets will react to US Employment data and Q4 results of companies like Dmart and Kotak Bank that will be announced on Saturday,” he said.

However, IPO fever continues in the domestic market. Another new-age tech stock, TBO Tek announced the launch of its INR 1,551 Cr IPO next week.

This week had four trading sessions with May 1 being a market holiday on the occasion of Maharashtra Day.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The 20 new-age tech stocks ended this week with a total market capitalisation of $43.46 Bn as against $49.17 Bn last week.

DroneAcharya Emerges As The Biggest Loser

Shares of drone startup DroneAcharya slumped sharply in three consecutive trading sessions at the beginning of this week.

Its 4.4% on Thursday was triggered by ace investor Shankar Sharma offloading his 2 Lakh shares or a 0.83% stake in the company.

However, by the end of the week, DroneAcharya picked some pace and rallied almost 3% on Friday, ending the week at INR 155.85 on the BSE.

We must note that after a significant rise last year, the stock has remained under pressure in the recent past despite some major important business announcements by the company.

In fact, this Thursday, DroneAcharya also said that it has bagged a work order of INR 53 Lakh from Alter Dynamics & Artificial Intelligence, which will entail the utilisation of its drones for inspection of piles above water, catering to the requirements of Abu Dhabi National Oil Company (ADNOC).

Speaking on DroneAcharya’s share performance, Amol Athawale, VP of technical research at Kotak Securities, said that the texture of the stock remains on the downside with INR 145-INR 150 being the immediate support level.

“If the stock continues to trade above that level then the immediate target would be INR 170-INR 175,” he said, adding that the larger texture indicates it would continue to trade between INR 145 and INR 175 price range.

IndiaMart Jumps On Q4 Earnings 

Shares of IndiaMart touched almost a seven-month high this week, at INR 2,913, after posting its Q4 earnings.

IndiaMart’s consolidated net profit jumped over 78% year-on-year (YoY) while its operating revenue rose 17% YoY to INR 314.7 Cr.

Overall, the shares surged 6.3% this week, ending Friday’s session at INR 2,801.05 on the BSE.

However, brokerage Nuvama maintained its ‘hold’ rating on the stock and revised its price target to INR 2,650 from INR 2,800 earlier, rolling forward to FY26.

The brokerage noted that the company’s paid supplier addition continues to remain subdued. 

“While we appreciate the company’s strong position and leadership in the B2B ecommerce marketplace, we believe that elevated churn would keep subscriber addition counts lower, thereby impacting collection/revenue growth,” it said.

Meanwhile, ICICI Securities said that given the stock remained rangebound over the last year on account of limited visibility on growth, the company’s improving earnings outlook could drive re-rating. 

The brokerage maintained its ‘buy’ rating on the stock and target of INR 3,500.

Kotak Securities’ Athawale said that a short-term rally is possible on the dismissal of INR 2,900 level, which is a crucial resistance for the stock.

The immediate support for the stock is at INR 2,650-INR 2,600, he added.

Challenges Continue In Paytm

The shares of Paytm continued to remain under pressure for another week. Its shares fell 1.8% further and are currently trading at INR 370.2 on the BSE.

In The News For:

• Following the regulatory actions against Paytm Payments Bank, its mobile wallet business operation has come to a grinding halt. RBI data showed that in March, Paytm Payments Bank registered 7.4 Mn fund transfer transactions in its prepaid payment instruments division, which was a 64% decline from the 20.7 Mn transactions reported in December 2023.
• In major reshuffles in the company, Paytm COO and president Bhavesh Gupta has stepped down from his position. 
• Meanwhile, its wealthtech arm Paytm Money’s CEO Varun Sridhar has stepped down and switched to a different role within the company. Rakesh Singh has been appointed as the new CEO of Paytm Money. 

Kotak Securities’ Athawale said though the larger texture continues to be on the downside, the INR 400 level remains the immediate level for the bulls.

There could be a technical bounceback above INR 400 level, which could touch INR 440. On the lower side, Paytm could touch INR 350 level also, he added.

The post New-Age Tech Stocks Witness A Volatile Week; TAC Infosec Top Gainer appeared first on Inc42 Media.

Indian new-age tech stocks witnessed a northbound momentum this week on the back of a rally in the broader market, despite mixed global cues and continuing tensions in the Middle East.

TAC Infosec, the latest addition to the list of the new-age tech stocks under Inc42’s coverage, emerged as the biggest gainer this week. The stock jumped a massive 55% this week, after gaining over 14% last week.

Meanwhile, 14 other stocks also gained this week in a range of 0.7% to over 11%.

While the shares of Zaggle and Mamaearth rallied over 11% each this week, RateGain surged 8.5%, and EaseMyTrip zoomed 7.2%.

Among the other top gainers were Yudiz, Nykaa, PB Fintech, and CarTrade, with their shares gaining over 5% each this week on the BSE.

However, DroneAcharya turned out to be the biggest loser, with its shares declining 5.2% this week. Shares of Zomato, Paytm, ideaForge, and Tracxn also saw marginal falls this week.

In the broader market, benchmark indices Sensex and Nifty50 gained 0.88% and 1.23%, respectively, this week. However, after a steady rally in the first four trading sessions, Sensex ended Friday’s session 0.82% lower at 73,730.16 and Nifty declined 0.67% to 22,419.95.

Speaking on the correction in the market by the end of the week, Prashanth Tapse, senior VP (research) at Mehta Equities, said the fall was on expected lines as both benchmark indices had rallied for five straight sessions and profit-taking was due for some time. 

“Correction is also attributed to global factors after the Japanese yen fell to a new 34-year low and disappointing US data pushed its benchmark yields to over 4.7%, thus worsening hopes of an interest rate cut in the medium term,” said Tapse.

Meanwhile, a fresh uptick in international crude oil prices amid the ongoing conflict in the Middle East is expected to continue to weigh on domestic inflation, the analyst believes.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

Reversing the previous week’s slump, the 20 new-age tech stocks ended this week with a total market capitalisation of $49.17 Bn as against $47.67 Bn last week.

TAC Infosec’s Impressive Rally

Continuing as the biggest gainer among the new-age tech stocks for the second straight week, Vijay Kedia-backed SaaS cybersecurity startup TAC Infosec rallied 55% this week.

It is pertinent to note that the startup listed on NSE Emerge earlier this month at a premium of 173.6% to its issue price of INR 106. TAC Infosec got listed at INR 290 and closed the week over 70% higher from the listing price at INR 494.

This week, the shares also touched a record high of INR 576.9.

In a recent development, TAC said it has been appointed as a key cyber security assessor for the App Defense Alliance (ADA). 

In a statement, TAC said that the ADA, which was originally launched by Google in 2019 to combat malicious Android apps, is now transitioning to the Joint Development Foundation (JDF) under the Linux Foundation. By joining the ADA, TAC would strengthen the alliance’s defence against evolving digital threats, it said.

Canada Pension Plan Investment Board Offloads Delhivery Stake

In another block deal in Delhivery, Canada Pension Plan Investment Board offloaded nearly half of its stake for INR 908 Cr.

The fund held 4.38 Cr shares in Delhivery, or a 5.96% stake, at the end of the March quarter of 2024. It offloaded 2.04 Cr shares in the company.

Meanwhile, the offloaded shares were lapped by American Fund Insurance, HSBC India Infrastructure Equity Mother Fund, and Fidelity.

Overall, Delhivery shares witnessed a volatile week and were up about 0.9% on the BSE. 

At INR 457.4, the stock is currently trading over 17% higher year to date.

Commenting on the stock, Jigar S Patel, senior manager, technical research analyst, at Anand Rathi, said Delhivery looks bullish on the charts but has a strong resistance at the INR 490 level.

If the stock closes above this level, it might taste INR 600 also, Patel said. However, he added that the stock is expected to trade sideways in the near term.

Paytm’s New Launch

Amid the rising competition in the soundbox market, fintech major Paytm announced the launch of two new soundboxes this week to receive UPI and credit card on UPI payments.

The company, which has been hit by a regulatory storm due to the Reserve Bank of India’s (RBI’s) recent action on Paytm Payments Bank, said that the new devices are fully made in India and equipped with 4G network connectivity. 

Meanwhile, its shares continue to remain bearish. This week, shares of Paytm declined 0.3% to end Friday’s trading session at INR 376.9 on the BSE.

Interestingly, despite the recent regulatory concerns, Indian mutual funds increased their shareholding in Paytm during the March quarter of FY24. The stake of mutual funds in Paytm stood at 6.15% at the end of March quarter as against 4.99% at the end of the preceding December quarter.

However, foreign institutional investors (FIIs) lowered their stake in the startup to 60.41% at the end of the March quarter from 63.72% at the end of the December quarter.

Anand Rathi’s Patel said that Paytm looks weak on the charts and the support for the stock is seen at around INR 375.

“If it goes below INR 375 next week, then the shares might fall further till INR 350 or lower,” he added.

The post New-Age Tech Stocks Rally; TAC Infosec Emerges As The Top Gainer For Second Straight Week appeared first on Inc42 Media.

Indian new-age tech stocks came under selling pressure this week on the back of a slump in the broader equity market, largely hurt by the fresh unrest in the Middle East.

Sixteen out of the 20 new-age tech stocks under Inc42’s coverage fell this week in a range of 0.04% to over 11% on the BSE, with Yudiz emerging as the biggest loser.

PB Fintech and Nykaa slumped over 5% each, Nazara fell 4.5%, while Zaggle, Tracxn, Paytm, and CarTrade were down over 3% each this week.

Meanwhile, the newest addition in the new-age tech stocks, NSE Emerge-listed TAC Infosec emerged as the top gainer this week as its shares rallied over 14%.

On the other hand, shares of DroneAcharya gained 12.5% this week. MapmyIndia and Fino Payments Bank were the two other gainers, with their shares zooming 4.3% and 1.1%, respectively.

In the broader market, benchmark indices Sensex fell 1.56% to 73,088.33 and Nifty50 declined 1.65% to 22,147. Besides the escalation in tensions between Iran and Israel, a largely muted Q4 FY24 performance of IT companies led to a slump in the market.

Though the domestic equity market ended the week in the green, with some upward momentum on Friday (April 19), uncertainty remains, largely due to the fresh conflict in the Middle East having a negative impact on oil prices.

Speaking on the market performance this week, Vinod Nair, head of research at Geojit Financial Services, said, “Globally, caution persisted as the situation in the Middle East remains fragile. Further, the potential delay of a US rate cut due to higher-than-expected inflation, robust retail sales, and elevated oil prices invoked subdued sentiments.”

“Muted Q4 earnings expectations and weak IT results could extend the consolidation. FIIs continued to remain risk-averse, a trend seen since last week,” said Nair, adding that large caps could offer solace for investors with their earnings stability.

This week, the market remained closed on Wednesday (April 17) on the occasion of Ram Navmi.

In the coming week, the market will react to global cues and the Q4 performance of the index heavyweights such as Wipro, HUL, Maruti, and Bajaj Finance, as well as certain economic data points, said Siddhartha Khemka, head of retail research at Motilal Oswal.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 20 new-age tech stocks now under Inc42’s coverage stood at $47.67 Bn at the end of this week.

Paytm’s Mixed Week

Shares of Paytm were largely under selling pressure this week and slumped 3.6% overall, ending Friday’s trading session at INR 377.9 on the BSE.

Adding to the fintech major’s existing woes, the Centre has now reportedly deferred the approval of its INR 50 Cr investment in its arm Paytm Payment Services.

A report earlier this week stated that the government’s step was partly due to concerns about China-based Antfin (Netherlands) Holdings’ shareholding in its parent entity One 97 Communications.

However, Paytm said that the report was “misleading” and it did not receive any such communication from the government.

On the other hand, in a respite after the crisis in Paytm Payments Bank, Paytm began migrating its UPI users to new payment system provider (PSP) banks’ handles after getting a nod from the National Payment Corporation of India (NPCI).

Paytm has expedited the integration with Axis Bank, HDFC Bank, State Bank of India (SBI), and Yes Bank to continue its UPI operations through these PSP banks.

It is pertinent to note that the shares of Paytm have nosedived over 50% since the beginning of the payments bank crisis on January 31 this year. 

Commenting on Paytm’s share performance, Rupak De, senior technical analyst at LKP Securities, said that weakness might continue in the stock until it moves back above INR 410. On the lower end, Paytm shares might fall towards INR 330, De said.

No End To Zomato’s Tax Troubles 

Foodtech major Zomato on Friday said that it received a goods and services tax (GST) notice of INR 11.8 Cr from the Gurugram GST authority.

As per its exchange filing, the new tax order consists of INR 5.9 Cr GST demand and a penalty of INR 5.9 Cr.

Zomato has been grappling with tax issues for some time and has received multiple such notices in the recent past. However, its shares have largely remained unaffected due to its strong financial performance over the last few quarters and D-Street’s bullish estimates on Blinkit’s growth.

In a research report this week, Bernstein said that India’s online food delivery market is moving in favour of Zomato, driven by its stronger execution and wider reach. 

Meanwhile, Blinkit and Swiggy’s Instamart are the top two players in the quick commerce space. While Blinkit’s gross merchandise value (GMV) stood at $510 Mn in H1 2023, Instamart’s GMV was at $419 Mn, noted the brokerage, adding that Blinkit also leads on profitability.

With the improving market share in its food delivery and quick commerce business, Zomato also continued with its experiments. Earlier this week, the company unveiled an all-electric large order fleet to deliver orders for up to 50 people in one go.

Amid the volatility in the broader market, shares of Zomato fell 1.7% this week, ending Friday’s trading session at INR 189.2 on the BSE. The shares are trading almost 53% higher year to date.

LKP’s De expects Zomato to continue its upward momentum and move towards INR 200 mark in the short term. The support for the stock is at INR 180, he added.

DroneAcharya Continues To Fly High

In a new development this week, the drone startup said that it inked an agreement with CBAI Technologies Private Limited to procure 200 Type Certified training drones over a span of three years.

The agreement marks a significant stride in DroneAcharya’s mission to revolutionise drone education and skill development in the country, the startup said in an exchange filing.

Earlier this week, DroneAcharya also announced opening its fourth drone training centre in Jaipur, Rajasthan, in partnership with Subhkhyati Aerospace Pvt. Ltd.

Amid these announcements, shares of DroneAcharya gained sharply in three consecutive trading sessions. Overall, the stock emerged as the second biggest gainer this week with a 12.5% rally, ending the week’s trading at INR 175.5 on the BSE.

LKP’s De said that DroneAcharya shares look positive on the technical chart and have support at INR 168. If the support level is not broken, it might move past the INR 200 mark, he added.

The post New-Age Tech Stocks Slump This Week As Broader Market Faces Selling Pressure; TAC Top Gainer appeared first on Inc42 Media.

Indian new-age tech stocks started the first week of FY25 with a massive rally as the broader domestic market also gained momentum.

Sixteen out of the 19 new-age tech stocks under Inc42’s coverage gained this week in a range of 0.6% to 20% on the BSE, with Tracxn Technologies emerging as the biggest gainer.

DroneAcharya (up 17%), PB Fintech (up 13.8%), CarTrade Technologies (up 12.3%), EaseMyTrip (gained 8.2%), Zomato (up 4.5%), and Paytm (up 3.7%) were among some of the biggest gainers this week.

However, Nazara Technologies fell 0.1% this week, while RateGain and IndiaMART declined 2.5% and 3.8%, respectively.

Meanwhile, TAC Infosec made its debut on NSE Emerge this week, listing at a premium of 173.6% to the issue price. The SaaS cybersecurity startup listed at INR 290 on the exchange.

In the broader market, both Nifty50 and Sensex gained 0.8% to end the week at 22,513.7 and 74,248.22, respectively. While the week began on a strong note, the market saw volatility in the later part of the week.

Vinod Nair, head of research at Geojit Financial Services, attributed the rise in volatility to a surge in US bond yields and crude oil prices, along with escalating geopolitical tensions.

“Despite the RBI’s policy meeting aligning with expectations, concerns surrounding food inflation and alerts of a heat wave tempered market sentiment,” Nair said.

It is pertinent to note that the Reserve Bank of India (RBI) this week kept the repo rate unchanged at 6.50%.

Analysts expect the market focus to shift to Q4 earnings season from next week, with TCS scheduled to announce its results on April 12. 

“Also, markets will take cues from global events like India and US inflation data, US Fed meeting minutes, and ECB policy meetings,” said Siddhartha Khemka, head of retail research at Motilal Oswal. “Markets on Monday would react to US non-farm payroll data and unemployment rate. Overall we expect the market to consolidate in a broader range with stock-specific action.”

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 20 new-age tech stocks now under Inc42’s coverage stood at $48.97 Bn at the end of this week as against 19 tech stocks ending last week at $46.56 Bn.

Zomato Continues To Soar

Despite some volatility at the beginning of the week, shares of food tech major Zomato touched a new all-time high of INR 191.9 on the BSE, gaining almost 4.5% during the week.

The stock also seems to be largely resilient to any negative developments.

In The News For:

• Earlier this week, the company received an INR 92 Cr tax order and a GST notice of INR 23.26 Cr for FY19 from Karnataka tax authorities.
• Continuing with its experiments, Zomato has now reportedly started piloting a new initiative that offers last-mile delivery to office goers inside corporate parks. 

Meanwhile, in a research note published this week, brokerage Bernstein reiterated its confidence in Zomato. 

It sees Zomato gaining share with a higher MTU base compared to Swiggy. Besides, Zomato has a bigger reach and deeper penetration in Tier 2 cities, driving a 67% share in monthly active userbase as of March 2024, Bernstein noted. 

Amol Athawale, VP of technical research at Kotak Securities, said the stock looks bullish on the charts and is holding breakout continuation formation.

“In the near future, as long as Zomato trades above INR 175, this sentiment will continue. On the higher side, INR 200-INR 205 is the immediate resistance for the stock,” said Athawale.

PB Fintech Closes At A 28-Month High

Shares of fintech major PB Fintech ended the week at INR 1,279.4 on the BSE, surpassing their listing price of INR 1,150 for the first time since December 2021.

The shares are currently trading at a level last seen in November 2021, just after the startup’s market debut.

This week, the shares rallied almost 14% amid its investors’ meeting.

Meanwhile, PB Fintech recently received a tax penalty order of INR 16.7 Cr. As per the company’s regulatory filing, the tax penalty was on the share premium received from investment houses during its Series D investment towards the share capital in the company in FY16. 

Commenting on the stock, Athawale said that the long bullish candle on the weekly chart suggests that the uptrend is likely to continue. He said INR 1,150 and INR 1,120 would be the immediate support area for PB Fintech shares, above which it might test INR 1,300-INR 1,325 in the near future.

Overall, shares of PB Fintech have gained over 60% year to date.

IndiaMART Emerges As The Biggest Loser

Shares of IndiaMART fell 3.8% to end the week at INR 2,544.05 on the BSE and emerged as the biggest loser.

The company announced a few rejigs recently:

• IndiaMART’s board approved the scheme of amalgamation amongst its three wholly-owned subsidiaries – Busy Infotech Private Limited (transferor company 1), Hello Trade Online Private Limited (transferor company 2), and Tolexo Online Private Limited (transferee company). The restructuring is aimed at streamlining group structure, and optimising operations and costs across the wholly owned subsidiary companies, IndiaMART said.
• Prateek Chandra, the company CFO has been transferred to a new role as chief strategy officer at IndiaMART.
• Jitin Diwan will be appointed as the new CFO, effective from May 14, 2024.

Kotak Securities’ Athawale said that IndiaMART is looking range bound on the charts and is expected to remain in the same state in the near future. 

Below INR 2,500, the selling pressure is likely to accelerate and the stock may fall to INR 2,450-INR 2,425 level, he added.

The post New-Age Tech Stocks Surge In The First Week Of FY25, Tracxn The Biggest Gainer appeared first on Inc42 Media.

The Indian new-age tech stocks witnessed some downtrends in the last trading week of FY24, in line with the selling pressure on IT stocks in the broader market. However, despite the initial period of volatility, the overall domestic market regained momentum.

Fourteen out of the 19 new-age tech stocks under Inc42’s coverage declined this week in a range of 0.8% to over 9%, with DroneAcharya becoming the biggest loser. RateGain, Yatra, EaseMyTrip, Nykaa, PB Fintech, ideaForge, and Nazara were also among the losers.

Meanwhile, Mamaearth, Zomato, MapmyIndia, CarTrade Technologies, and Paytm gained in a range of 0.06% to almost 9% during the week. 

Mamaearth emerged as the biggest winner, jumping 8.7% on the BSE, with its shares gaining sharply in all three trading sessions.

Imperative to mention that the week had three trading sessions, as the market remained closed on Monday (March 25) on the occasion of Holi and on Friday (March 29) for Good Friday.

Benchmark indices Nifty50 gained 1.04% during the week to close at 22,326.90, while Sensex rose 1.13% to end at 73,635.48 on Thursday (March 28).

Vinod Nair, head of research at Geojit Financial Services noted that FY24 marked a rewarding period for the Indian market, though the year ended on a subdued note, with substantial selling pressure remaining until March 20. 

“Nevertheless, there has been some relief in the market in recent trading sessions as the pressure from leveraged selling has eased and buying activity has improved, albeit at lower volumes… As we move on to a new financial year, we express optimism towards sectors such as pharma, capital goods, and infra, as we see them as key growth drivers, supported by both domestic and external demand,” Nair said.

Meanwhile, he noted that some sectors like FMCG and IT are facing challenges due to subdued demand at present, but a turnaround is anticipated on the back of a normal monsoon and increased US demand following the Fed’s rate cut.

“However, the focus is on large caps, as the premium valuation of midcaps could have a hiccup in the short to medium term,” Nair added.

The upcoming general elections will be a key driver in the stock market in the coming months.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $46.56 Bn at the end of this week as against $46.05 Bn last week.

Zomato’s New All-Time High

As a testament to its strong bullish momentum, shares of food tech major Zomato rallied sharply to touch a fresh all-time high at INR 188.95 on Wednesday (March 27) on the BSE.

Overall, the shares gained 4.7% during the week and ended the last trading session of FY24 at INR 182.35 on the BSE.

We must note that brokerages continue to remain bullish on the stock. This week ICICI Securities raised its price target (PT) on Zomato to INR 300 from INR 182 earlier.

Zomato remains its top pick in the Indian internet space, the brokerage said. It raised the PT due to a significant increase in its long-term explicit forecasts, given the improved visibility on Zomato’s sustained growth trajectory and sustained improvement in profitability metrics, ICICI said.

It is also pertinent to note that Zomato shares remained steady even amid the launch of its ‘Pure Veg Fleet’ last week and the subsequent backlash on social media platforms. Also, addressing the matter further, company cofounder and CEO Deepinder Goyal said this week that he was taken aback by the backlash as the decision was taken based on a survey.

“We had done a large survey of people who are more than 50 years old. An overwhelming majority said they needed a veg-only option and preferred veg-only restaurants… So, we launched it. We had not expected such an uproar,” he said in an interview with another publication.

Commenting on the stock, Jigar S Patel, senior manager and technical research analyst, at Anand Rathi, said that in the next few days, the INR 185 level would be a massive resistance for Zomato.

However, if it manages to close above that level, the shares might trade further higher to test INR 190-INR 195 level.

Shares of Zomato have gained almost 50% year to date.

DroneAcharya Emerges As The Biggest Loser

Shares of drone startup DroneAcharya, which were in a correction mode since February this year, fell 9.3% on the BSE this week.

Losing in all three trading sessions, DroneAcharya ended the last trading session of the current fiscal at INR 129.15 on the BSE.

Its shares nosedived even as the BSE SME-listed startup made important announcements this week. 

DroneAcharya said that it secured a “significant” contract from one of the Indian Army’s Artilleries from Eastern Command for supplying FPV (First Person View) drones with night vision capability. 

The company also said that it achieved a milestone by securing a drone supply order worth INR 1.84 Lakh from the Eastern Command of the Indian Army, Ministry of Defence. The order initiates a larger-scale engagement, with two other work orders – drone supply with night vision and drone pilot training.

While shares of DroneAcharya gained sharply in 2023, they have already declined 33% so far this year on the BSE.

Anand Rathi’s Patel said that if the stock manages to remain above the INR 125 level, it could reverse from here on and touch INR 145 in the next one to two weeks.

EaseMyTrip Bolsters Its B2B Playbook

The online travel aggregator EaseMyTrip said that it was looking to invest INR 33 Cr ($3.9 Mn) in B2B travel Portal E-Trav Tech Limited, acquiring a 4.94% stake in the company.

E-Trav Tech provides travel API to businesses, including flight APIs, holiday packages, hotel APIs, and bus APIs, among others, which allows travel companies to offer competitive travel deals and content from global travel suppliers. 

Shares of EaseMyTrip plunged in two consecutive trading sessions this week. Overall, the stock fell more than 2%, ending the week’s last trading session at INR 42.89 on the BSE.

Anand Rathi’s Patel said that the support for the stocks is currently at INR 40-INR 41 but there is also a bullish pattern created at this level. 

Hence a reversal is possible once the stock touches this critical support zone and could rally till INR 48-INR 49 in the next one to two weeks, he added.

The post New-Age Tech Stocks End FY24 On A Subdued Note; DroneAcharya Emerges As The Biggest Loser appeared first on Inc42 Media.

After a few weeks of significant downfall, Indian new-age tech stocks staged a recovery this week, partially helped by stock-specific actions and the broader market recovery.

Thirteen of the 19 new-age tech stocks under Inc42’s coverage gained in a range of 0.7% to 9% during the week, with Nykaa emerging as the biggest winner.

Shares of Paytm, which have been seeing severe volatility since the beginning of February, also witnessed a strong uptrend this week and gained 8.5% on the BSE.

Zomato, Yatra, PB Fintech, Delhivery, Nazara, and DroneAcharya were among the other gainers this week.

Meanwhile, six tech stocks fell during the week in a range of 0.2% and 3.3% on the BSE, with Zaggle being the biggest loser. 

In the broader market, the benchmark indices were volatile but rallied sharply in the last two trading sessions, as the US and UK central banks kept the interest rates unchanged. Nifty50 gained 0.33% during the week to close at 22,096.75, while Sensex rose 0.26% to end at 72,831.94 on Friday (March 22).

Siddhartha Khemka, head of retail research at Motilal Oswal, said, “Next week being a truncated week and the derivatives’ monthly expiry, we might see some volatility while Nifty is likely to consolidate at higher levels.” 

Meanwhile, Vinod Nair, head of research at Geojit Financial Services, said that concerns persist regarding inflated valuations of the mid and small-cap stocks. However, large caps are expected to outperform in the medium term.

Amid the ongoing IPO frenzy, the public issues of two new-age tech companies will open next week for listing on NSE Emerge. While fintech SaaS company Trust Fintech Limited’s IPO will open on March 26, TAC Security’s IPO will open on March 27.

The stock market will remain closed on Monday (March 25) on the occasion of Holi.

Now, let’s take a look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $46.05 Bn at the end of this week as against $43.74 Bn last week.

Zomato’s ‘Pure Veg Fleet’ Debate

Share of food tech giant Zomato rallied 8.9% this week amid the launch of its ‘Pure Veg Fleet’ even as the company’s move faced backlash from some users.

In The News For

• Zomato founder and CEO Deepinder Goyal took to X on Tuesday (March 19) to announce the launch of a new delivery fleet called ‘Pure Veg Fleet’ and a new mode on its app called ‘Pure Veg Mode’ for customers with 100% vegetarian dietary preference.
• Following backlash, the company on the next day reversed its decision to introduce a green uniform for delivery partners designated for the new fleet.

Amid all these developments, shares of Zomato rallied over 10% in three consecutive trading sessions starting from Wednesday (March 20). Its shares ended the week at INR 174.1 on the BSE.

Meanwhile, it is also pertinent to note that earlier this week, brokerage Jefferies included Zomato in the list of its “top picks” for the next five years. 

The brokerage sees a 2.5X upside in Zomato’s share price by March 2029, reaching the INR 400 mark.

“Low penetration levels in core segments offer a long runway to growth with both food delivery (19% GOV CAGR over FY24-30) and quick commerce (40% CAGR) expected to jump,” Jefferies said.

Zomato found its name alongside 10 other companies in the “top picks”, including Ambuja Cement, Axis Bank, JSW Energy, L&T, Max Healthcare, and SBI.

Shares of Zomato are currently trading almost 41% higher year to date.

PB Fintech’s New Payment Aggregation Arm

Insurtech major Policybazaar’s parent entity PB Fintech announced this week its plans to incorporate a new wholly-owned subsidiary to enter the payment aggregation business. 

The new subsidiary will have a proposed authorised share capital of INR 50 Cr and a proposed paid-up share capital of INR 27 Cr. 

The announcement came weeks after PB Fintech said it was foraying into the reinsurance space.

Shares of PB Fintech rallied sharply following the announcement this week. Overall, the stock gained more than 5%, ending the week at INR 1,154.85 on the BSE.

Though the stock has seen some profit booking at higher levels this month, its growth trajectory remains steady. Overall, PB Fintech is trading over 45% higher year to date.

Nykaa Top Gainer

Reversing its recent trend of muted market performance, shares of Nykaa rallied almost 9% this week. The shares ended the last trading session at INR 163.35, a level last seen at the beginning of February.

Earlier this week, Nykaa founder and CEO Falguni Nayar addressed various topics, including rising competition in the beauty retail space, in an interview given to news agency PTI.

“I always say that let’s stay focused on the consumer and let’s give them far beyond the expectations so that consumers don’t have a reason to go to competition,” she said. 

Meanwhile, HSBC reportedly said in a research note earlier this week that Nykaa shares are attractive post the 12% drop this year.  

The company is among the top mid-cap picks of HSBC, along with seven others, including Prestige Estates, Phoenix Mills, Voltas, and Kalyan Jewellers.

“Post correction, Nykaa’s BPC business, which is structurally growing revenue at 20%-plus, trades at appealing valuations while the value in its fashion business is likely to be unlocked as it reaches EBITDA breakeven within the next two years,” HSBC reportedly said.

The brokerage retained its price target of INR 240 on the stock, which implies a 47% upside to its last close.

The post New-Age Tech Stocks Rally This Week, Nykaa Emerges As The Biggest Winner appeared first on Inc42 Media.

Continuing the last week’s slump, Indian new-age tech stocks nosedived this week amid volatility and a major correction in the broader domestic equity market.

Eighteen of the 19 new-age tech stocks fell in a range of 0.03% to a massive 33% this week. Amid the bloodshed, IndiaMART InterMESH emerged as the only gainer this week by rising 0.7% on the BSE.

Yudiz Solutions turned out to be the biggest loser by falling 32.8%, followed by Fino Payments Bank (down 11.4%) and DroneAcharya Aerial Innovations (down 10.6%).

Besides, Zaggle and CarTrade Technologies slumped over 9% each, Tracxn Technologies and Yatra fell over 8% each, while ideaForge, Nykaa, and Delhivery declined more than 4% each this week.

Meanwhile, shares of Paytm continued to remain under pressure amid multiple new developments and fell 7.5% on the BSE.

In the broader market, the benchmark indices witnessed a volatile week, largely affected by weak global cues and concerns about rich valuations of many stocks. Nifty50 declined 2.09% to close the week at 22,023.35, while Sensex fell 1.99% to end at 72,643.43 on Friday (March 15).

Vinod Nair, head of research at Geojit Financial Services, said that unfavourable risk-reward balance of mid and small-cap stocks, fuelled by prolonged premium valuations, aggravated the downfall in the market. 

“We expect bargain opportunities to persist in mid and small-cap stocks whose valuations are supported by fundamentals. In the week ahead, the global central bank’s monetary policy decision will get investors’ attention,” he said. 

The US Federal Reserve, Bank of England, and Bank of Japan are set to unveil their interest rate decisions next week. 

Nair said currently there is uncertainty over Fed rate cuts due to an increase in the US unemployment rate and higher-than-expected US inflation. 

Overall, analysts expect the volatility to continue in the Indian equity markets in the near term.

Now, let’s deep dive into the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $43.74 Bn at the end of this week as against $44.64 Bn last week and $55.49 Bn the week before.

Paytm Shows No Signs Of Recovery

Shares of Paytm continued to remain volatile amid multiple developments at the fintech giant following the Reserve Bank of India’s crackdown on Paytm Payments Bank. The stock continues to face selling pressure at every major rise.

Meanwhile, the central bank’s deadline for the payments bank ended this week and the curbs are into effect now.

What’s The Update?

• Paytm secured the Third-Party Application Provider (TPAP) licence from the National Payments Corporation of India (NPCI).
• Paytm is also reportedly planning to transfer its point of sale (PoS) terminals to RBL Bank.
• Meanwhile, the National Highways Authority of India (NHAI) notified Paytm FASTag users to procure a new FASTag from another bank.
• The RBI revealed that it received 501.86 complaints per branch against Paytm Payments Bank between April 1, 2022, and March 31, 2023.
• Paytm’s parent entity One 97 Communications is likely to cut about 20% of its workforce across departments as part of its annual performance review.

Shares of Paytm sharply declined in the first three sessions of the week but gained a little in the last two trading sessions. Overall, the shares crashed 7.5% this week on the BSE.

After getting the TPAP licence from the NPCI, the stock jumped 5% to touch the upper circuit on Friday and close the week at INR 370.9 on the BSE.

Nazara On Acquisition Mode 

Gaming major Nazara Technologies said it has earmarked $100 Mn for mergers and acquisitions over the next two years in an attempt to further strengthen its global presence.

The company also said that it completed the transaction to buy a stake in influencer marketing platform Kofluence, almost a month after announcing that it received the board’s approval to acquire 10.77% stake in the company for a total consideration of up to INR 32.41 Cr.

Nazara said in its statement that it now holds 10.38% of the total equity share capital of Kofluence on a fully diluted basis.

Earlier, the company, which recently secured INR 760 Cr via a preferential allotment from investors such as Nikhil Kamath, ICICI Prudential MF, and others, told Inc42 that it was looking to use the fresh funds for organic as well as inorganic expansion. 

After a significant rise last year, shares of Nazara have witnessed a massive downfall so far this year. This week, its shares slumped in the first three trading sessions but saw some improvement towards the end of the week.

Overall, the shares declined about 3% on the BSE this week. Shares of Nazara have nosedived over 30% in the last two months.

DroneAcharya Wins Major Contracts

The drone startup saw major new developments this week, including winning an order from the Adani Group for providing the Directorate General of Civil Aviation (DGCA) certified drone pilot training to the enterprise.

Besides, DroneAcharya bagged an order from Earthtree Enviro Pvt. Ltd. for the supply of the Precision Mapping System.

Enhancing its B2G collaborations further, DroneAcharya secured a contract to supply IT hardware for the Indian Army’s drone lab in Jammu and Kashmir. It also bagged the First Person View (FPV) drone pilot training contract from the Ministry of Defence, Department of Military Affairs.

The startup also said this week that it received accreditation as a DGCA-certified Medium Category Drone Pilot Training Organisation, which grants DroneAcharya legal authorisation for flying drones within the weight range of 25 kg-150 kg in crucial sectors like agricultural spraying and delivery drones. 

Despite the major developments, its shares nosedived significantly in the first three trading sessions this week but gained some momentum on Thursday (March 14). Overall, the shares fell 10.6% this week on the BSE.

The post Bloodbath In New-Age Tech Stocks As Broader Market Slumps; IndiaMART The Only Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks witnessed a bloodbath this week amid a slump in the IT stocks in the broader market.

Eighteen out of the 19 new-age tech stocks under Inc42’s coverage fell this week in a range of 1% to over 17%. Fino Payments Bank was the only gainer this week, rallying 5.6% to end the week at INR 326.6 on the BSE.

Meanwhile, Yudiz emerged as the biggest loser this week by falling 17.45%, followed by DroneAcharya (down 10.5%) and Nazara Technologies (down almost 10%).

ideaForge and CarTrade Technologies fell over 8% each during the week, Mamaearth and Zaggle lost over 6%, while Tracxn Technologies, Zomato, RateGain, and MapmyIndia declined over 4% each.

Though the IT stocks were under pressure this week, the benchmark indices closed the week at record highs despite witnessing a range-bound movement. While Nifty50 closed at 22,493.55, Sensex ended the week at 74,119.39.

Speaking on the market performance this week, Vinod Nair, head of research at Geojit Financial Services, said that the expectations of a rate cut by the Fed and declining bond yields prompted investors to shift to equities, which bolstered the market. The improved macroeconomic narrative helped banking stocks, while the extension of the FAME-II scheme partially led to heavy buying in auto stocks this week.

However, uncertainties in the global market led to weakness in the IT sector, he said.

“The release of US payroll data, and upcoming inflation data from the US, China, and India next week will provide investors with insights into the global macroeconomic outlook. We expect volatility to persist in the upcoming week due to high valuations and forthcoming policy rate guidance releases,” Nair added.

This week had only four trading sessions as the exchanges were shut on Friday on the occasion of Mahashivratri.

Now, let’s deep dive into the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $44.64 Bn at the end of this week as against $55.49 Bn last week.

Paytm Allots ESOPs

While the fintech major continues to remain under pressure due to the uncertainties created by the RBI’s regulatory action on Paytm Payments Bank, Paytm’s parent One97 Communications announced fresh ESOP allotment this week.

In an exchange filing on Tuesday (March 5), the company said its board approved allotment of 2.66 Lakh equity shares to eligible employees.

While the stock was already volatile, it declined further in the sessions after the announcement.

Meanwhile, RBI governor Shaktikanta Das said this week that the restrictions imposed on Paytm Payments Bank won’t have an impact on almost 80-85% of Paytm users. However, there remains a challenge in migrating 10-15% of the payment bank users to other banks, he added.

Overall, shares of Paytm slipped 3.3% during the week. However, the shares gained a little more than 2% in Thursday’s trading session, ending the week at INR 401.05 on the BSE.

Despite the regulatory hurdles, Paytm boss Vijay Shekhar Sharma expressed his confidence about making a strong comeback. Speaking at a financial technology conference in Tokyo earlier this week, he said, “Make Paytm an Asia leader — in my lifetime, I would like to do that.” 

Meanwhile, analysts expect Paytm to continue to remain volatile in the coming weeks.

Antfin Offloads 2% Stake In Zomato

Chinese tech major Ant Group’s arm Antfin Singapore offloaded Zomato shares worth INR 2,827 Cr in two bulk deals this week.

Antfin sold 9.7 Cr shares of the foodtech major in a deal, offloading a 1.1% stake. It sold an additional 7.93 Cr shares via another deal. 

Antfin owned over 55 Cr shares of Zomato at the end of the quarter ended December 2023. Following the stake sale this week, it is now expected to hold 37.4 Cr shares in the company.

Meanwhile, Morgan Stanley Asia lapped up 5.7 Cr shares of the footech giant.

Following Antfin’s stake sale, shares of Zomato slumped in the next two trading sessions. After reaching a record high of INR 175.5 on the BSE last week, the stock fell 4.6% this week to close at INR 159.95 on Thursday. 

The stock has been seeing a bull run since the beginning of February, gaining almost 14% in just one month.

March Capital Offloads CarTrade Shares

CarTrade Tech’s pre-IPO shareholder March Capital offloaded almost 9.5 Lakh shares in bulk deals worth over INR 70 Cr this week.

March Capital holds stake in CarTrade via MCP3 SPV and Springfield Venture International. Springfield sold 6.32 Lakh shares of CarTrade shares, or a 1.35% stake, while MCP3 SPV offloaded 3.16 Lakh shares, or a 0.67% stake.

Shares of CarTrade, which rose sharply in the previous weeks, fell in all four trading sessions this week. The stock crashed almost 8.1% this week and closed at INR 719.1 on the BSE.

It came under significant selling pressure despite ICICI Prudential Mutual Fund and ICICI Prudential Asset Management Company buying some of the shares offloaded by March Capital. 

The post New-Age Tech Stocks Come Under Selling Pressure; Fino Payments Only Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks witnessed positive momentum this week in line with the broader market, which received a boost as the country reported faster-than-expected GDP growth in the third quarter of the ongoing financial year.

Eleven of the 19 new-age tech stocks under Inc42’s coverage saw a northbound movement this week, gaining in a range of 0.5% to over 24%. Zaggle emerged as the top gainer during the week.

CarTrade Technologies (up 11.7%), PB Fintech (up 6.4%), Nykaa (up about 5%), and Zomato (up 2.2%) were among the gainers.

On the other hand, shares of eight new-age tech stocks dipped during the week in a range of 0.5% to 5%. Mamaearth turned out to be the biggest loser this week, with the stock falling 5.5%, followed by Yudiz (down 4.4%).

Nazara Technologies, Fino Payments Bank, DroneAcharya, Yatra, IndiaMART, and Tracxn were the other losers during the week.

In the broader domestic equity market, despite the volatility, Sensex rallied 0.91% to end the week at 73,806.15 while Nifty50 rallied 0.7% to 22,378.4. The indices made sharp gains on Friday, day after the release of the Q3 GDP numbers. 

Siddhartha Khemka, head of retail research at Motilal Oswal, said that the domestic equities surged to a new high after India’s GDP saw an impressive 8.4% growth in Q3, driven by robust manufacturing, highlighting the inherent strength and potential of the economy. 

Khemka expects the ongoing momentum to continue and the market to take cues from a fresh set of economic data next week. 

It is pertinent to note that this week saw an extra trading day, with the market opening on Saturday (February 3) for a special trading session to test Disaster Recovery Sites of the exchanges.

Speaking on the market performance, Prashanth Tapse, senior VP (research) at Mehta Equities, said that despite the sharp rally on Friday, volatility cannot be ruled out due to concerns about delays in rate cuts by central banks, conflict in the Middle East, and expensive valuations of local stocks. 

However, the upsurge shows that investors are willing to place bullish bets on Indian stocks amid continuity in economic policies and a robust investment climate, he added.

Now, let’s deep dive into the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $55.49 Bn at the end of this week as against $44.9 Bn last week.

Paytm Continues To See Volatility 

Shares of fintech major Paytm, which have been under pressure for the last one month following the announcement of banking restrictions by the Reserve Bank of India on Paytm Payments Bank, continued to see volatility this week as well. 

The stock largely witnessed sideways movement but gained 1.7% during the week. It ended Saturday’s special trading session at INR 414.5 on the BSE, 2.6% lower from Friday’s close.

Let’s take a look at the new developments this week at Paytm:

• In one of the biggest developments, Paytm founder and CEO Vijay Shekhar Sharma stepped down from the Paytm Payments Bank board, which is set to discontinue its banking operations by March 15.
• Paytm also agreed to discontinue various inter-company agreements with its Paytm Payments Bank.
• Reportedly, Paytm is expected to have applied for a third-party application provider (TPAP) licence in partnership with Yes Bank and Axis Bank. 
• Amid the ongoing troubles, the Financial Intelligence Unit-India (FIU-IND) imposed a penalty of INR 5.49 Cr on Paytm Payments Bank for violating money laundering norms. However, the company said that it pertained to issues within a business segment that was discontinued two years ago.
• While the shares are under pressure, SoftBank offloaded over 2% stake, or 1.37 Cr shares, in Paytm this week.
• Meanwhile, Paytm is also reportedly set to restart its loan disbursals from the first week of March, after it hit a pause amid the crisis at the payments bank.

Analysts expect the volatility in the stock to continue, along with selling pressure. 

Rupak De, senior technical analyst at LKP Securities, said that Paytm is currently a sell-on-rise kind of stock.

“From the current level, it might move up towards INR 500 in the short term but those rallies will be used to reduce exposure in the stock,” De said. 

Zaggle Emerges As The Biggest Gainer

Shares of fintech SaaS startup Zaggle jumped over 24% during the week on the back of its multiple partnership announcements. 

• On February 24, Zaggle said it was contracted to be a co-brand partner with Nishi Forex, an authorised dealer for forex cards, to carry out activities such as sales and distribution, marketing and campaigning, bundled with Zaggle expense management to drive card spending and greater usage of the software
• Zaggle also entered into an agreement with Europ Assistance India Pvt. Ltd to provide the latter with Zaggle’s benefits & expense management platform and its business spends management platform
• The startup has entered into an agreement with Axis Bank to be a referral partner of the bank in carrying out activities such as sales and distribution, marketing and campaigning

Shares of Zaggle have been on a sharp upward rise since the end of January and have gained over 52% since the end of the month. They closed the week at INR 358.15 on the BSE.

PB Fintech Continues To Rally 

Shares of PB Fintech, which have witnessed a sharp rise since the fintech startup’s announcement of its foray into the re-insurance space, continued their upward trajectory this week.

Last month, the parent entity of insurtech major Policybazaar said that it has received an in-principle approval from the Insurance Regulatory and Development Authority of India (IRDAI) to upgrade its licence and enter the reinsurance business.

On February 28, PB Fintech confirmed that the insurance regulator has granted the certificate of registration to Policybazaar to act as Composite Insurance Broker, with effect from February 28, 2024.

“With grant of new Certificate of Registration, the category has been changed from Direct Insurance Broker (Life & General) to Composite Insurance Broker,” the exchange filing said.

Shares of PB Fintech gained in four consecutive trading sessions at the beginning of the week but then shed some of the gains to end the week at INR 1,115.15 on the BSE. Overall, the shares gained 6.4% during the week.

The stock has gained over 40% year to date.

However, LKP Securities’ De said that the stock has now formed a reversal kind of pattern on the daily charts and might move down towards INR 1,050-INR 1,030 in the short term due to profit booking.

The resistance for the stock is at INR 1,130, he added.

The post New-Age Tech Stocks Regain Momentum; Zaggle Emerges As The Biggest Gainer This Week appeared first on Inc42 Media.

Indian new-age tech stocks saw another week of mixed performance but sharp gains of over 10% in some of the counters took the combined market cap of these stocks to almost $45 Bn at the close of the trading on Friday (February 23).

Paytm managed to reverse the downward trend of the past three weeks and emerge as the biggest gainer this week. The Vijay Shekhar Sharma-led company’s shares surged 19.4% during the week. It was followed by fintech SaaS startup Zaggle, which rallied 13%.

Drone manufacturing startup ideaForge also witnessed a massive 11.4% jump during the week, followed by another fintech major, PB Fintech (up 10.1%).

Besides, five others, including Nykaa, Zomato, and DroneAcharya, gained in a range of 0.6% to 5% on the BSE this week. Meanwhile, Delhivery gained marginally and Yatra’s shares ended the week at the same price as last week.

Overall, eight out of the 19 new-age tech stocks under Inc42’s coverage fell in a range of 0.08% to almost 8% this week. RateGain was the biggest loser, declining 7.7%. It was followed by Nazara, which fell 6.2% on the BSE.

In the broader domestic equity market, it was a sectorally mixed week. However, Sensex rallied 0.99% to end the week at 73,142.8 while Nifty50 jumped 0.8% to 22,212.7. Both the indices also touched new all-time highs during the intraday trading on Friday but gave up the gains on the back of domestic and global macroeconomic developments.

Siddhartha Khemka, head of retail research at Motilal Oswal, said that mixed flash estimates of Purchasing Managers’ Index (PMI) for February for both India and the US, along with the hawkish tone of the RBI in its MPC meeting, dented investor sentiments. 

He said the market rally might take a pause next week ahead of various global economic data releases. However, the overall trend remains positive. 

On the other hand, Prashanth Tapse, senior VP (research) at Mehta Equities, said that with the corporate earnings season coming to the end, traders are awaiting new catalysts. However, pre-election momentum remains in the market. 

“But concerns over rising crude oil prices, surging US bond yields, and stretched valuations linger on the market and are likely to prompt continued selling by FIIs,” Tapse added.

Now, let’s take an in-depth look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $44.9 Bn at the end of this week as against $43.2 Bn last week.

Paytm’s Sharp Recovery 

Shares of fintech major Paytm gained in three consecutive trading sessions this week and also touched the upper circuit of 5% at INR 407.6 on the BSE during Friday’s trading session.

Paytm rallied 19.4% this week to reverse its losing streak, which began after the RBI clamped down on Paytm Payments Bank.

The company’s shares gained this week after the RBI, on February 16, extended the deadline for some of the business restrictions on its payments bank to March 15 from February 29 earlier. The central bank’s frequently asked questions (FAQs) on the issue also provided more clarity to stakeholders, turning investor sentiment a little positive. 

Besides, Paytm’s decision to shift the nodal account of Paytm Payments Bank to Axis Bank also added to the optimism.  

It is pertinent to note that on January 31, the RBI issued a notification barring Paytm Payments Bank from taking any deposits or credit transactions, or top-ups in any of its customer accounts. Shares of Paytm crashed almost 50% following this. The RBI also asked the payments bank to stop providing any banking services, including UPI facility and fund transfers.

Earlier, brokerage Bernstein warned of a lasting impact of the regulatory action on Paytm’s business. 

However, in its latest research note this week, the brokerage said, “However, we believe the regulatory actions are restricted to the PPBL (Paytm Payments Bank Limited) entity, and we expect the company to successfully execute the operational changes required to remove the dependency on PPBL with limited long-term impact to their overall business.” 

Meanwhile, Jefferies has suspended its rating and price target (PT) on Paytm until the news flow settles down. The brokerage also sees a 28% YoY decline in the company’s FY25 revenue, pushing it into cash burns.

Earlier this week, the RBI asked the National Payments Corporation of India (NPCI) to examine Paytm’s request to become a third-party application provider for UPI payments.

Speaking on Paytm shares, Ganesh Dongre, senior manager, technical research, at Anand Rathi, said that the stock seems to have still not touched its bottom point and it’s better to remain in a wait-and-watch phase.

The resistance for the stock is at around INR 490, he said. Dongre said he would suggest buying the stock only if its price goes beyond this level. 

RateGain Emerges As The Biggest Loser

After emerging as the top gainer last week, shares of traveltech SaaS startup RateGain nosedived 7.7% this week. Its shares ended Friday’s close at INR 807.5 on the BSE.

The startup’s shares declined despite the Expedia Group recognising it as an Elite Connectivity Partner for 2024. 

Besides, RateGain also announced the launch of its unified rate insights platform navigator that would help commercial teams eliminate extra effort, bringing everything on one screen that would help revenue management, marketing, and distribution act faster on insights. 

RateGain has made significant gains over the last two months. Helped by these gains, the company’s market capitalisation crossed the $1 Bn mark in the last week of December.

RateGain shares have gained 10.5% so far in 2024.

ideaForge To Enter The US Market

Shares of drone startup ideaForge soared 7% on Friday to end the week at INR 779.6 on the BSE after its CEO Ankit Mehta said that the company is set to enter the US market.

While the stock was already witnessing an upward momentum throughout the week, the news about the entry in the US market added to the rally. Overall, ideaForge shares gained 11.4% during the week.

However, the shares continue to trade significantly below their listing price of INR 1,305.1 on the BSE.

Anand Rathi’s Dongre said that the stock is still in a “falling channel”. While the stock has witnessed small rebounds after each quarter, the gains haven’t sustained, he observed.

“We need a proper closing of this counter above INR 820 to advise investors to go long on it,” Dongre added.

The post Paytm Emerges As The Biggest Gainer In Another Mixed Week For New-Age Tech Stocks appeared first on Inc42 Media.

The Indian new-age tech stocks continued to witness mixed investor response, even as the broader domestic equity market recovered amid improving global cues.

Of the 19 new-age tech stocks under Inc42’s coverage, 11 declined this week in a range of 0.1% to almost 19% on the BSE, with Paytm once again being the biggest loser.

Other losers this week were ideaForge (down 5.1%), DroneAcharya (down 4.7%), Yatra (fell 2.7%), Nazara (down 1.4%), and PB Fintech (down 0.2%).

Meanwhile, eight tech stocks gained during the week in a range of 0.5% to 5% with RateGain emerging as the biggest gainer. The travel tech SaaS startup rallied sharply this week after it announced that hospitality platform HotelKey chose RateGain’s platform to enhance its distribution capabilities. 

Besides, Zomato rallied almost 5% and ended the week at a 52-week high of INR 160 on the BSE. Logistics unicorn Delhivery was also up 3.2%. 

On the other hand, Mamaearth and IndiaMart gained almost 3% while Tracxn Technologies was up 1.8% during the week. Nykaa and CarTrade Technologies gained more than 0.5%.

In the broader market, Sensex rallied 1.16% and Nifty50 1.2%, both reaching very close to their all-time highs.

Vinod Nair, head of research at Geojit Financial Services said that the Indian market continued its broad-based recovery aided by positive global and domestic cues. 

“Narrowing India’s trade deficit, led by softening commodity prices and a manufacturing push by the government, attracted investors to capital goods, metals, and industrial stocks,” Nair said. “On the global front, an expectation of a pickup in consumption demand in China after the New Year holidays supported the global market sentiment,” he added.

Meanwhile, Siddhartha Khemka, head of retail research at Motilal Oswal expects the market sentiment to strengthen further as the prospect of a pre-election rally is quite strong. 

“Two important pre-poll surveys by India Today and Times Now predict a more than comfortable majority (272+ seats) for the incumbent BJP-led NDA. Nifty is hovering near all-time zones and is all set to make new highs next week,” Khemka added.

Now, let’s take an in-depth look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $43.19 Bn at the end of this week as against $42.74 Bn a week ago.

Paytm’s Market Cap Down 56% In A Month

As the crisis in Paytm Payments Bank continued, shares of Paytm parent One97 Communications ended at new record lows in three consecutive trading sessions this week. The stock touched a low of INR 318.35 during Friday’s intraday trade (February 17). 

However, the stock ended Friday’s trading 5% at INR 341.5 on the BSE, higher than Thursday’s close, helped by some positive developments.

Overall, Paytm shares tanked 18.7% this week.

Here’s a quick look at the Paytm crisis:

• RBI governor Shaktikanta Das said there was “hardly any room” to review the stance on Paytm Payments Bank.
• After ED registered a case of forex violations against Paytm Payments Bank, Paytm issued a statement saying its banking unit does not undertake outward foreign remittances.
• In some relief to Paytm Payments Bank, RBI extended its deadline for stopping other banking services, including UPI facility and fund transfers, to March 15 from February 29 earlier. 
• RBI clarified that Paytm QR codes, soundboxes, and card machines would continue to be operational even after March 15, given the merchants migrate to other banks. 
• Paytm said that it shifted the nodal account of Paytm Payments Bank to Axis Bank. 

On the technical charts, Paytm’s movement remains unpredictable as its shares are impacted by new news developments.

It is pertinent to note that brokerage Macquarie has downgraded Paytm stock to ‘underperform’ from an earlier ‘neutral’ rating and lowered its price target to INR 275 from INR 650. The brokerage sees Paytm at the risk of losing a large number of customers.

 Amid the crisis, Paytm’s market cap declined 56% in one month and is currently at an all-time low – $2.61 Bn.

Yatra Back In The Black

Online travel aggregator Yatra Online reported a consolidated net profit of INR 1.1 Cr in Q3 FY24 as against a loss of INR 5.6 Cr in the year-ago period and a net loss of INR 17.1 Cr in the preceding Q2 FY24.

Its operating revenue also jumped almost 23% year-on-year (YoY) and 17.2% sequentially to INR 110.3 Cr in Q3 FY24.

Though Yatra once again reported a profitable quarter after a loss-making quarter, its profit was far below the INR 6 Cr profit it reported in Q1 FY24.

Shares of Yatra declined 3% a day after its Q3 earnings announcement but ended the week marginally higher at INR 170 on the BSE.

Overall, Yatra shares were down 2.7% during the week but its movement largely remained sideways.

Nazara’s Acquisition Spree Continues

In an all-new deal announcement, gaming major Nazara’s esports subsidiary NODWIN Gaming said it would acquire 100% ownership of Ninja Global FZCO (Ninja), expanding its solutions offering to publishers and brands in the Middle East and Turkey.

The development comes within a month of NODWIN Gaming’s acquisition of Comic Con India for INR 55 Cr and an investment of about INR 71.8 Cr in a German marketing services company for gaming and esports, Freaks 4U Gaming. 

Over the last few years, Nazara bolstered its offerings by making multiple acquisitions, including NODWIN and SportsKeeda, and post the recent fundraise from Zerodha’s Kamath brothers and others, the gaming company has doubled down on its acquisition spree.

However, the shares declined marginally after its latest deal announcement on Wednesday (February 14). Overall, its shares fell 1.4% during the week, ending the last trading session at INR 845.8 on the BSE.

Earlier this month, Jefferies raised the price target on the stock to INR 810 from INR 770, implying a downside of 4.2% to Nazara’s last close. The brokerage also reiterated its ‘hold’ rating due to a weakness in Kiddopia, Datawrkz, and real money gaming segments.

With NODWIN’s media rights revenues also falling in the nine months of FY24, the brokerage cut its esports revenue estimates. In fact, after its Q3 results earlier this month, the shares haven’t witnessed any major momentum so far.

The post Another Mixed Week For New-Age Tech Stocks — Paytm Spirals Downward, RateGain Top Gainer appeared first on Inc42 Media.

The Indian new-age tech stocks witnessed another mixed week, seeing stock-specific action, amid weakness in the broader market. 

Of the 19 new-age tech stocks under Inc42’s coverage, eight gained this week in a range of 0.6% to more than 18%. Zaggle emerged as the biggest winner post its robust Q3 FY24 show.

Earlier this week, Zaggle reported a more than 10X year-on-year (YoY) jump in profit after tax (PAT) to INR 15.2 Cr in the December quarter and 35.1% increase in operating revenue to INR 199.5 Cr.

On the other hand, ideaForge gained almost 4.2%, Zomato jumped about 4%, and EaseMyTrip grew 3% during the week.

Meanwhile, 11 new-age tech stocks declined this week in a range of 0.5% to almost 14%, with Paytm once again becoming the biggest loser amid the regulatory crisis at Paytm Payments Bank.

Nykaa was the second-biggest loser this week, with its shares falling 7.9% as the company’s Q3 FY24 results missed certain Street estimates. While the fashion and beauty ecommerce major’s net profit more than doubled to INR 17.4 Cr in the quarter, its beauty and personal care business continued to witness muted growth.

PB Fintech, RateGain, Mamaearth, Yatra, and CarTrade were also among the losers this week.

In fact, CarTrade slipped into a loss in Q3 FY24, hurt by the loss in the auto sales division of the OLX business that it shut during the quarter.

In the broader market, Sensex declined 0.68% to 71,595.49 and Nifty50 fell 0.3% to 21,782.5

Dr Joseph Thomas, head of research at Emkay Wealth Management, said, “The equity market remained volatile during the week, responding to events like the Fed Policy announcement and the RBI policy in quick succession. (The fact) that it may be a while before the central banks would go in for a rate cut has not pleased many, though the expectation is that the central banks would ultimately relent and that peak rates are behind us.” 

Though the market is good fundamentally, there might be some amount of profit booking resulting in further decline in the coming weeks, Thomas said.

Siddhartha Khemka, head of retail research at Motilal Oswal, said there was a sharp selling in the market on Friday on account of the rise in crude oil prices and muted global cues amid the Lunar New Year holiday in Asian markets. 

“…diminishing hopes of early rate cuts too dampened the sentiments. Post the hawkish commentary from the US Fed and the RBI and their focus on bringing inflation under control, next week’s inflation data would be important data to watch out for,” said Khemka. 

He expects the market to turn cautious and consolidate in the near term, as some key macro data are set to be announced and the Q3 earnings season is nearing its end. 

Now, let’s take a deeper look at the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $42.74 Bn at the end of this week against $43.34 Bn in the previous week.

Paytm’s Struggle Continues

Shares of fintech major Paytm continued to witness volatility amid the ongoing regulatory issues at Paytm Payments Bank. In the first trading session of the week, Paytm shares slumped to hit a lower circuit but gained in the next two trading sessions. 

However, the shares slumped once again in the last two trading sessions, ending the week at INR 419.85 on the BSE.

Let’s take a look at the updates in the company this week:

• Paytm CEO Vijay Shekhar Sharma met the RBI officials and finance minister Nirmala Sitharaman this week to discuss the regulatory concerns flagged by the RBI on Paytm Payments Bank.
• Reports emerged this week that Jio Financial Services is one of the top contenders to buy Paytm’s wallet business. However, the fintech major rejected this. 
• Paytm also denied reports of the company or Paytm Payments Bank being under investigation for violation of foreign exchange rules.
• Securities depository Central Depository Services India (CDSL) initiated customer verification inspection of Paytm Money
• RBI’s deputy governor Swaminathan Janakiraman clarified that the central bank’s action is against Paytm Payments Bank and not the Paytm app.
• Paytm formed a group advisory committee, headed by former SEBI chairman M Damodaran, to address compliance and regulatory issues.
• Reportedly, Paytm is close to getting approval from the authorities for additional investment in its payments arm Paytm Payments Services Ltd.

As the problems continue, the shares of Paytm remained under severe pressure this week. Further movement in the stock is likely to be guided by the developments on the regulatory front.

Amol Athawale, VP of technical research at Kotak Securities, said it is difficult to predict the movement of the stock as it is highly volatile and reacting to news stories. 

“However, INR 525-INR 550 would be the immediate resistance. Further corrections cannot be ruled out in the near future,” Athawale added.

Zomato Posts Third Profitable Quarter

Shares of food tech major Zomato surged 6.3% in the last two consecutive trading sessions of the week after it posted a profitable Q3 FY24. Its net profit jumped 283% sequentially to INR 138 Cr in the reported quarter.

While the company’s core food delivery business growth remained muted, Zomato’s quick commerce business Blinkit as well as B2B business, Hyperpure, showed strong momentum in Q3.

Shares of Zomato gained 3.9% overall during the week, ending at INR 149.45 on the BSE.

Several brokerages have reiterated their confidence in Zomato post the earnings. Jefferies raised its price target (PT) on the stock to INR 205 from INR 190 earlier, which implies an upside of over 37% to its last close.

“3Q FY24 was another strong quarter with exceptional performance in quick commerce and smart margin gains in food delivery; growth here could have been better, but (the) result is understandable in the context of weakness across consumption categories,” said the brokerage.

Emkay also raised its PT to INR 170 from INR 140 earlier. The analysts at the brokerage said they liked Zomato’s strong growth and execution in Blinkit but did not like muted consumer demand leading to lower-than-expected food delivery GOV growth.

Zomato’s food delivery GOV grew a mere 6.3% QoQ to INR 8,486 Cr in Q3.

Kotak’s Athawale said Zomato is consistently forming higher-high higher-low on the charts and the larger texture is still bullish. 

“However, in the short-term, it seems to be slightly in the overbought zone. Considering overall market conditions, it might see range-bound activity in the near term,” he said.

Athawale sees INR 139-INR 140 as immediate support for the stock. The stock can move up to INR 160-INR 165 in the near future.

Mamaearth’s Q3 Earnings

Listed D2C major Mamaearth posted a 264% jump in its consolidated net profit on a YoY basis to INR 25.9 Cr. However, it was a decline sequentially from INR 29.4 Cr posted in Q2 FY24. 

Operating revenue also took a hit on a QoQ basis but grew 28% YoY to INR 488.2 Cr during Q3 FY24.

Despite the muted growth on a QoQ basis, Varun Alagh, chairman and CEO of Honasa Consumer Limited, Mamaearth’s parent entity, said that the Q3 results are a testimony of the company’s deep understanding of the beauty market in India. 

“Four out of six brands from our portfolio are already in the INR 150 Cr ARR club and we see this as a testimony of our capabilities,” he said. “As we move forward, focus continues to be on purpose-based brand building, innovation and distribution expansion.” 

Shares of Mamaearth fell 0.8% this week. However, on Friday, ahead of the company’s earnings announcement, its shares ended 3.5% higher compared to Thursday’s close at INR 432.75 on the BSE.

Athawale said that INR 419-INR 420 is the immediate support zone for the stock. If it sustains this level, it can bounce to INR 460-INR 470. 

He sees INR 480-INR 485 to be the immediate resistance level.

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Indian new-age tech stocks saw a mixed performance this week, which largely saw stock-specific actions as the broader domestic equity market remained volatile due to multiple macroeconomic factors, including the interim Budget.

Following the Reserve Bank of India’s (RBI’s) crackdown on Paytm Payments Bank, the shares of Paytm’s parent entity, One97 Communications, crashed over 36% this week. 

Besides, of the 18 other new-age tech stocks under Inc42’s coverage, nine, including Tracxn Technologies, Mamaearth, Nazara Technologies, ideaForge, and Fino Payments Bank, fell this week in a range of 0.3% to over 9% on the BSE.

Tracxn and Fino reported their Q3 FY24 earnings this week. While Fino’s consolidated profit after tax (PAT) jumped 19% year-on-year (YoY) to INR 22.8 Cr, Tracxn reported a PAT of INR 2.2 Cr, a 64% decline YoY, including the exceptional gain in the year-ago quarter.

On the other hand, nine new-age tech stocks gained during the week in a range of 1% to a little over 18%, with Delhivery emerging as the biggest winner.

PB Fintech, RateGain, Zomato, Nykaa, and IndiaMART were among the other gainers during this week.

In the broader market, Sensex rose 1.96% to end the week at 72,085.63 and Nifty50 gained 2.3% to 21,853.8. 

Commenting on the performance, Vinod Nair, head of research at Geojit Financial Services, said that even a “conservative” interim Budget couldn’t slow down the market amidst the pre-election rally.

“The drastic fall in the fiscal deficit target is leading to a reduction in bond yields, which will lead to lowering of corporate borrowing costs, increasing incentives to step up investment,” Nair said. “Furthermore, the FOMC has tempered expectations that the central bank will soon slash interest rates and that inflation in the US is continuing to cool.”

The US Fed kept benchmark interest rates unchanged at 5.25%- 5.50% for the fourth straight meeting this week.

Siddhartha Khemka, head of retail research at Motilal Oswal, said that after the US Fed’s decision and interim Budget, all eyes will be on the RBI’s policy meeting next week. 

“We expect the central bank to maintain its status quo. Overall, we expect the market to remain in positive territory as sentiments remain high amid commendable delivery on Budget,” Khemka added.

Now, let’s deep dive into the performance of some of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $43.34 Bn at the end of this week.

Paytm In Fresh Trouble

Shares of Paytm touched the lower circuit by crashing 20% in two consecutive sessions during the week after the RBI barred Paytm Payments Bank from taking any deposits or credit transactions or top-ups in any of its customer accounts.

The central bank also stopped Paytm Payments Bank from providing any other banking services, such as UPI facility and fund transfers after February 29, 2024

Shares of Paytm nosedived to a level last seen in December 2022, ending the week at INR 487.05 on the BSE.

Paytm has issued the following statements on the matter:

• Paytm Payments Bank said it’s taking immediate steps to comply with the RBI’s directions, including working with the regulator to address the central bank’s concerns. 
• A day after the RBI’s order, Paytm’s top management tried to assuage the fear of investors and highlighted the steps the fintech giant would be taking over the next few weeks.
• Founder and CEO Vijay Shekhar Sharma assured its users that the Paytm app will continue to work beyond February 29.
• Madhur Deora, president and group CFO at Paytm has issued a statement clarifying that Paytm and Paytm Payments Bank are not one entity. “Paytm, as a payments company works with various banks (not just its associate), on various other products… The next phase of the company’s journey is to continue to expand its payments and financial services businesses, only in partnership with other banks,” Deora said.

It is pertinent to note that One97 Communications, holds a 49% stake in Payment Payments Bank. Multiple brokerages have cut their ratings and price targets (PTs) on shares of Paytm following RBI’s restrictions.

Jefferies cut its rating to ‘underperform’ and PT to INR 500. The brokerage expects an additional 20% hit on Paytm’s EBITDA, led by the impact on lending business from rising reputational concerns.

“We believe the recent events will drag the company’s growth and elongate profitability timelines,” Jefferies said.

Motilal Oswal also downgraded Paytm to a ‘neutral’ rating and cut its PT on the stock to INR 575, expressing concerns over its business outlook.

Brokerage Macquarie also said that given the severe restrictions imposed on Paytm Payments Bank, Paytm’s ability to retain customers in its ecosystem would be impacted. 

Amid a crash in its stock, Morgan Stanley Asia (Singapore) Pte. – Odi lapped up 50 Lakh Paytm shares on Friday (February 2) in a bulk deal worth INR 243.6 Cr.

Delhivery Turns Net Profitable

Logistics unicorn Delhivery turned profitable in the December quarter. It posted a consolidated profit after tax (PAT) of INR 11.7 Cr in Q3 FY24 against a net loss of INR 195.6 Cr in the year-ago period.

The company’s operating revenue also grew over 20% YoY to INR 2,194.5 Cr in the reported quarter.

Ahead of the company’s earnings announcement, Delhivery shares gained over 18% during the week. The stock made sharp gains in two consecutive sessions on Tuesday and Wednesday. The company released its Q3 numbers after market hours on Friday.

Delhivery also turned out to be the biggest gainer this week. Its shares closed the week at INR 472.9 on the BSE – a level last seen in October-end 2022.

PB Fintech Posts Maiden Profitable Quarter

Shares of PB Fintech surged 10% the day after it reported its first net profitable quarter in Q3 FY24. The company reported a PAT of INR 37.2 Cr in the December quarter and a 43% YoY jump in operating revenue to INR 871 Cr.

Helped by the positive earnings results, PB Fintech’s shares gained 10.7% overall during the week, ending the last trading session at INR 982.85 on the BSE.

Brokerage JM Financial is optimistic on the company’s insurance vertical Policybazaar following steady growth in the segment in Q3 FY24 despite a tepid insurance industry growth.

“With renewals expected to gain in revenue mix, PB Fintech is likely to see rising incremental contribution from core insurance business while Paisabazaar’s incremental contribution journey is expected to be relatively gradual,” the brokerage noted. 

It has a PT of INR 1,010 on the stock, which implies an upside of about 3% to the stock’s last close.

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Most of the Indian new-age tech stocks fell this week, in line with a significant slump in the broader equity markets due to the weakness in the banking sector.

Drone startup ideaForge emerged as the biggest loser this week, with its shares slumping 6.6% on the BSE. 

Besides, 10 out of the 19 stocks under Inc42’s coverage fell between 0.7% and 5.7% during the week. Nykaa, Paytm, IndiaMART, DroneAcharya, and Nazara Technologies were among the other losers this week.

However, Zomato, PB Fintech, Delhivery, RateGain, EaseMyTrip, Fino Payments Bank, Mamaearth, and CarTrade Technologies gained in a range of 0.09%-4% this week, with CarTrade emerging as the biggest gainer.

After an extended trading session last week, there were only three trading sessions this week as Monday (January 22) and Friday (January 26) were market holidays on the occasion of the consecration ceremony of the Ram temple in Ayodhya and the Republic Day celebrations, respectively.

Among the benchmark indices, Sensex and Nifty50 declined a little over 1% each during the week to 70,700.67 and 21,352.6, respectively. 

Commenting on the market’s performance this week, Siddhartha Khemka, head of retail research at Motilal Oswal, said that weak results of Tech Mahindra, Axis Bank, and HDFC bank continued to weigh on the stocks of IT and private banks. 

“FIIs have been mostly sellers in the month of January, having sold more than 30K Cr so far. Going ahead, the market is likely to consolidate further ahead of the US Fed interest rate decision on Wednesday where Fed is expected to maintain the status quo and give some hint with regards to rate cut timeline,” Khemka said.

However, with many heavyweights releasing their Q3 earnings next week, stock-specific action is expected to continue despite market consolidation. Among the new-age tech stocks, RateGain, Delhivery, PB Fintech, and Fino Payments Bank are scheduled to report their quarterly earnings next week.

Santosh Meena, head of research at Swastika Investmart, said that the Union Budget, earnings, and US Fed policy will keep the market on its toes next week.

“The upcoming week is poised to be pivotal, marked by a series of significant events, with the Budget taking the centre stage. However, the finance minister’s indication of a modest, vote-on-account budget suggests a lack of extravagant announcements,” said Meena.

Now, let’s take a look at the performance of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $41.69 at the end of this week as against  $42.67 Bn last week.

SoftBank Continues To Pare Stake In Paytm 

After Paytm reported its Q3 FY24 earnings last week, the Japanese investment giant said in an exchange filing this week that it sold another 2% stake in the fintech major in a series of disposals between December 19, 2023 and January 20, 2024.

SoftBank offloaded 1.27 Cr shares of Paytm, worth INR 950 Cr ($114 Mn), during this period.

As per the BSE data, at the end of the quarter ending December 2023, SoftBank’s SVF India Holdings (Cayman) Limited held 4.10 Cr shares in Paytm or a 6.46% stake.

After SoftBank’s announcement on Tuesday (January 23), BNP Paribas Arbitrage and Societe Generale together offloaded 52.78 Lakh shares in Paytm via block deals worth INR 397.9 Cr on January 25.

Various funds of Marshall Wace Investment Strategies bought most of these offloaded shares via block deals.

After surging over 13% last week, Paytm fell 2.72% on the BSE this week. The stock ended the last trading session at INR 762.9 on the BSE.

Paytm’s net loss narrowed over 43% year-on-year (YoY) to INR 222 Cr in Q3 FY24.

Commenting on Paytm’s stock performance, Amol Athawale, vice president of technical research at Kotak Securities, said that the INR 800 level would act as a crucial resistance for the stock. 

“On the downside, if its shares slip below INR 735, we can expect the stock to correct till INR 700-INR 690,” said Athawale.

Zomato Forays Into Payments Ecosystem

Share of Zomato managed to gain this week despite volatility in the broader market. The stock rose 2.18% to end the week at INR 136 on the BSE.

In The News For:

• In another major development for the foodtech giant, the Reserve Bank of India (RBI) has granted a certificate of authorisation dated January 24, 2024 to Zomato Payments Private Limited to operate as an online payment aggregator.
• Amid the Indian market witnessing large selling by FIIs, Societe Generale offloaded 86.5 Lakh shares in Zomato for INR 117.82 Cr in a block deal on Thursday (January 25). Marshall Wace Investment Strategies bought the offloaded shares via block deals.

After gaining over 100% last year on the back of improving bottom line, shares of Zomato are trading almost 10% higher year to date in 2024.

In a research report this week, brokerage Bernstein said that the company would continue to gain higher incremental gross merchandise value (GMV) as compared to Swiggy.

Kotak Securities’ Athawale said that Zomato is currently making a bullish formation on the charts. 

“After a short-term correction, the stock is moving sideways but the consolidation is positive,” he said, adding that INR 125-INR 128 is the immediate support area for the stock. Beyond this, it can move up to INR 147-INR 150.

Nazara’s Acquisition Spree Continues

After announcing a fundraise of INR 250 Cr last week, Nazara’s esports subsidiary NODWIN Gaming announced acquiring a 100% stake in Comic Con India for INR 55 Cr ($6 Mn) in a cash and stock deal this week.

Shares of Nazara remained volatile during the week but gained in two trading sessions. Overall, its shares fell 1.31% on the BSE this week, ending the last trading session at INR 910.1.

It is pertinent to note that Nazara has been focusing on acquisitions after raising funding from Zerodha’s cofounders and SBI Mutual Fund last year. Last week, Nazara also announced acquisition of a 10.77% stake in Kofluence Tech Private Limited.

The company’s shares have been on a bull run since the beginning of the year but slumped a bit in the last few trading sessions and were trading sideways. 

Commenting on the stock performance, Kotak Securities’ Athawale said it is holding a higher bottom formation, which indicates that an uptrend is likely. 

“For the short term, INR 850-INR 860 would be the immediate support zone for the stock. On the higher side, the shares might touch INR 920 and even INR 1,000-INR 1,020,” Athawale added.

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Indian new-age tech stocks witnessed a mixed week on the back of a sharp decline in the broader domestic market following HDFC Bank’s underwhelming Q3 FY24 results and weak global cues.

Of the 19 tech stocks under Inc42’s coverage, 10 slumped this week in a range of 0.3% to 9%. Nykaa emerged as the biggest loser this week.

Shares of IndiaMART fell this week after its weak Q3 earnings. Zomato, EaseMyTrip, Nazara Technologies, and ideaForge were among the other losers this week. 

On the other hand, Paytm, which reported strong December quarter results, gained 13.3% this week on the BSE to emerge as the biggest winner.

Yudiz, DroneAcharya, PB Fintech and CarTrade Technologies were among the other gainers this week.

Overall, nine tech stocks gained during the week in a range of 0.3% and over 13% on the BSE.

Besides IndiaMART and Paytm, MapmyIndia also reported its Q3 earnings in the week. The geotech company also saw muted growth during the quarter.

Among the benchmark indices, Sensex declined 1.58% to 71,423.65 and Nifty50 fell 1.47% to 21,571.8 during the week. However, on the last trading day, Saturday (January 20), the market gained some momentum and ended the session in the green.

It must be noted that the stock market had an extended trading session this week, with Saturday being a working day. Next week will see markets opening only for three days. While Monday will be a market holiday on the occasion of the consecration ceremony of the Ram temple in Ayodhya, there would be no trading on the Republic Day on Friday.

Vinod Nair, head of research at Geojit Financial Services, attributed the subdued performance during this week to weak global cues and elevated domestic valuations in mid- and small caps, which eroded investor confidence. 

“Strong US retail sales and rising US bond yields diminish expectations of a swift Fed rate cut, redirecting investor focus to safer bonds. In addition, discouraging Chinese economic data further contributed to the lacklustre sentiment,” said Nair.

Siddhartha Khemka, head of retail research at Motilal Oswal, expects stock-specific movements next week as more companies report their quarterly earnings.

Moreover, the interest rate decision of the Bank of Japan and the European Central Bank is due next week, along with the US GDP and PMI data, which would influence the global rate cut trajectory, Khemka added.

Now, let’s take a look at the performance of the new-age tech stocks this week.

Despite the overall volatility, the total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $42.67 at the end of this week as against $42.34 Bn last week.

Paytm Trims Its Loss 

Shares of Paytm surged over 13% this week, largely driven by its strong Q3 FY23 results. The stock ended the week at INR 784.2 on the BSE.

Despite the fintech major witnessing degrowth in its lending business on a quarter-on-quarter (QoQ) basis, which was expected after it scaled down the business partially in December, it managed to bring down its net loss during the quarter.

Here’s a quick glimpse at Paytm’s Q3:

• Net loss narrowed over 43% year-on-year (YoY) to INR 222 Cr, while operating revenue surged 38% to INR 2,850 Cr
• Revenue from payment services to merchants saw the biggest jump during the quarter
• Loans amounting to INR 15,535 Cr were disbursed during the quarter, up 56% YoY but down over 4% QoQ

Besides, Paytm also announced incorporating new wholly owned subsidiaries in GIFT City and building an AI-driven cross-border remittance and payments technology system, which will deliver cost-effective solutions at a global scale. 

Following the earnings announcement, brokerage CLSA upgraded Paytm stock to ‘buy’ and raised the price target (PT) to INR 960 from INR 925 earlier. 

“There seems to be some focus on cost reduction; for the first time, employee expenses (Ex-ESOP) were flat QoQ. It seems to us that the company will try to offset the bulk of the BNPL business loss by doing a little bit in various things – new revenue streams, cost reduction, etc,” the brokerage said.

Jigar S Patel, senior manager of technical research analyst at Anand Rathi, said that traders can buy the stock in the range of INR 750-INR 780. 

The target for the stock would be INR 900 with a stop loss at INR 699, he added.

Nazara Raises More Funding

 Shares of Nazara Technologies saw an upward movement at the start of the week but began sliding down mid-week. However, the stock made a comeback and ended the last two trading sessions in the green, rising marginally. 

Overall, the stock lost 2.49% during the week, ending the last trading session at INR 922.15 on the BSE.

It is pertinent to note that Nazara is aiming to close its planned fundraise of INR 750 Cr, which was announced earlier in 2023, with additional investment from Zerodha cofounders Nikhil and Nithin Kamath.

This week, the gaming major’s board approved raising INR 250 Cr via preferential issue. It would receive INR 100 Cr from the Kamath brothers’ NKSquared and Kamath Associates. Others including ICICI Prudential and Plutus Wealth will also invest in the company. 

Following the announcement, Nazara also said that it would acquire a 10.77% stake in Kofluence Tech Private Limited from certain existing investors of the latter through a share swap deal. With this partnership, the companies are planning to launch an influencer-driven game discovery platform.

The following day, its shares dropped almost 3% on the BSE.

“Nazara has given a breakout on the weekly chart, so one can buy the stock in the range of INR 880-INR 920,” said Anand Rathi’s Patel. 

He recommended stop loss for the stock at INR 850 and a target at INR 1,100 for the next one-and-a-half month.

MapmyIndia Reports Weak Q3

The geotech startup reported a profit after tax (PAT) of INR 31.1 Cr, which increased about 5% YoY in Q3 FY24. However, it declined 6% QoQ.

MapmyIndia’s operating revenue also saw a mere 1% YoY increase in the quarter, rising to INR 92 Cr.

The growth was partially hurt by its automotive and mobility tech business (A&M), which saw a decline on a QoQ basis.

However, MapmyIndia also announced bagging an order worth INR 400 Cr for providing map and connected services to Hyundai and Kia Motors OEM business in India for the next five years.

After declining sharply in three straight sessions from Tuesday (January 16), the stock regained most of the lost momentum in the last two trading sessions. Overall, the shares gained 1.17% during the week, ending at INR 2,044 on the BSE.

Shares of MapmyIndia have largely shown sideways movement over the last four-five months.

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Indian new-age tech stocks witnessed a bull run this week, largely helped by stock-specific developments and the overall improvement in the broader domestic market as IT companies reported better-than-expected Q3 FY24 results.

Fourteen out of the 19 new-age tech stocks under Inc42’s coverage rose this week, gaining in a range of 0.8% to 20%. EaseMyTrip emerged as the biggest winner, with its shares surging 19.8% on the BSE.

EaseMyTrip’s competitor Yatra gained 18.3%, while Nazara Technologies rose 11.2%. PB Fintech, Paytm, Zomato, Nykaa, and Mamaearth were among the other gainers this week.

From EaseMyTrip’s suspension of flight bookings to Maldives to Paytm’s INR 100 Cr investment announcement in Gujarat International Finance Tec (GIFT) City, the listed tech startup ecosystem had an eventful week.

Only five new-age tech stocks declined during the week, slipping between 0.4% and 6%. DroneAcharya, IndiaMART, and ideaForge fell over 5% on the BSE this week.

After a decline last week and the beginning of this week, benchmark indices Sensex and Nifty gained 0.75% and 0.85%, respectively, this week. Sensex closed 1.18% higher at 72,568.45 on Friday and Nifty ended the week 1.14% higher at 21,894.55, with both the indices touching fresh all-time highs.

A rally in IT stocks and a 19% surge in India’s net direct tax collections supported domestic equities to make new highs on Friday, said Siddhartha Khemka, head of retail research at Motilal Oswal. 

“Nifty is now just 100 points away from crossing another milestone of 22K zone. In the coming week, the market will take cues from Q3 results, India’s inflation, and US PPI data. Thus, we might see stock-specific action,” said Khemka.

Overall, with a positive start to the December-quarter earnings season, experts see further rally in the market from here on.

Prashanth Tapse, senior VP (research) at Mehta Equities, said, “Investors are hoping that likely rate cuts by the Fed later this year would improve the scenario for the IT sector, which will enable big clients to increase spending on IT sourcing.”

Now, let’s take a look at the performance of the new-age tech stocks this week.

The total market capitalisation of the 19 new-age tech stocks under Inc42’s coverage stood at $42.34 Bn at the end of this week as against $39.72 last week.

EaseMyTrip Emerges As The Biggest Winner

EaseMyTrip emerged as the biggest winner this week as its shares rallied almost 20% this week. The stock rose to an 11-month high. 

There were two main developments around the stock this week: 

• The traveltech major announced the launch of its new subsidiary, EaseMyTrip Insurance Broker Private Limited, this week to foray into the insurance broking space.
• Amid the ongoing tensions between India and Maldives following Prime Minister Narendra Modi’s visit to Lakshadweep, the startup announced suspension of all flight bookings for the island nation. EaseMyTrip has also started flaunting a tagline, “Nation First, Business Later.”

The developments come at a time when the startup is looking to raise INR 1,000 Cr through a preferential issue.

After being one of the few gainers in 2022, when most of the listed new-age tech stock slumped, 2023 turned out to be a muted year for EaseMyTrip. Its shares fell over 23% last year. However, the stock has been witnessing an uptrend since the beginning of 2024 and has already gained 23% year-to-date (YTD).

Nykaa Regains Investors’ Confidence

In its Q3 FY24 performance update, Nykaa said that the fashion vertical continued to see strong growth even as the beauty and personal care (BPC) business witnessed a slowdown.

The ecommerce major said that its fashion vertical’s gross merchandise value (GMV) for Q3 is expected to grow at around 40% YoY, while the same for the BPC vertical would be in mid-twenties.

“For Q3 FY24, at a consolidated level, we expect our NSV to grow in the mid-twenties and revenue to grow in the low twenties on a YoY basis,” Nykaa said.

The business update cheered the street as its shares gained 11.7% till Thursday, rising in all four sessions. However, the stock slumped over 3% on Friday to close the week at INR 187.6 on the BSE, as Lexdale International Limited offloaded 2.6 Cr shares in the company in a bulk deal worth INR 495.4 Cr.

Overall, Nykaa shares gained 8.2% this week.

Experts believe that large block and bulk deals pose a risk to the share prices of new-age tech companies like Nykaa, Paytm, Zomato, and Mamaearth in the near to medium term.

Meanwhile, brokerage Jefferies increased its price target (PT) on Nykaa this week to INR 230 from INR 200, which implies an upside of 6.6% to the stock’s last close.

The brokerage believes that Nykaa would continue to see steady growth with improving margins, supported by operating leverage. 

“The growth runway in BPC is huge as the category is still in a nascent stage in India,” Jefferies said. “Competition is a concern, and hence a key monitorable.”

On the other hand, Nykaa also found a mention in Goldman Sachs’ research note this week, titled “The rise of ‘Affluent India’”. The brokerage said Nykaa is among the companies that would benefit from the rise in the number of ‘affluent’ customers in the country.

The international brokerage expects Nykaa’s revenue to grow at a 27% CAGR in the FY24-FY27 period.

Blinkit’s Strong Show To Drive Zomato’s Growth

Shares of Zomato touched a new 52-week high this week as they rose 4.8% on the BSE. The stock ended the week at INR 139.6, a level last seen in the beginning of January 2022.

Several brokerages, including HSBC, Goldman Sachs, and Jefferies, increased their PTs on Zomato this week, ahead of its Q3 earnings, by INR 10-INR 30.

While HSBC sees Zomato’s December quarter results to be slightly muted, it believes Blinkit would continue to show steady growth.

It said that a further upside in the stock would be largely driven by the quick commerce business and assigned a PT of INR 150 to Zomato.

On the other hand, Jefferies raised its PT on Zomato to INR 190, which implies a 36.1% upside to the stock’s last close. It expects Blinkit to see a faster scale up at 38% CAGR over FY24-28, with the vertical’s contribution margin rising to 6% by FY28 and EBITDA margin to 4%.

Meanwhile, in its note on the rise of ‘Affluent India’, Goldman Sachs picked Zomato as one of its top ideas and said that the competition from Swiggy will remain “benign”.

Meanwhile, Zomato’s series of experiments continues. This week, it introduced a daily payout feature for select restaurants.

Mehta Equities’ Tapse also included Zomato in the list of bullish stocks. “Zomato is highlighted as a top pick with targets at INR141/INR 163 and aggressive targets at INR 201 over a 12-15 month holding period,” he said.

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