Zomato Becomes First Startup to Join BSE Sensex Index

resr 5paisa Research Team

Last Updated: 23rd December 2024 - 01:18 pm

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Zomato Ltd has reached a significant milestone by becoming the first startup to debut on the Bombay Stock Exchange’s (BSE) Sensex index as of Monday, December 23, 2024. This achievement marks a shift in the Sensex, which is composed of India’s top 30 companies, as Zomato replaces JSW Steel Ltd.

Impact of Joining the Sensex

Zomato’s inclusion in the Sensex is expected to draw inflows of $513 million (₹4,362.35 crore) and lead to outflows of $252 million (₹2,142.91 crore) from JSW Steel, as estimated by brokerage firm Nuvama and reported by Economic Times.

Strong Market Performance

In the last six months, Zomato’s share price has surged by approximately 43%, with an impressive 126% growth over the past year. This performance far outpaces JSW Steel’s modest 9% annual increase. Zomato’s market capitalization has also risen to ₹2.72 lakh crore, exceeding JSW Steel’s ₹2.24 lakh crore.

Key Drivers of Growth

According to UBS, Zomato’s nearly 150% stock rally over the past 18 months can be attributed to its efforts to enhance unit economics and approach breakeven, especially within the quick commerce (qcom) segment.

Financial Highlights

The company reported a 69% year-on-year increase in consolidated revenue from operations, amounting to ₹4,799 crore in Q2 of FY2024-25. Net profit jumped fivefold to ₹176 crore, reflecting strong financial health and bolstering investor confidence.

Significance of the Achievement

Zomato’s induction into the Sensex underscores the rising prominence of startups in India’s financial landscape. This accomplishment serves as a benchmark for other innovative companies aiming for similar success in the capital markets.

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