Food delivery giant Zomato Ltd has made history as the first startup to join the Bombay Stock Exchange’s (BSE) Sensex, replacing major steel company JSW Steel Ltd in the benchmark index of India’s top 30 companies. Effective December 23, 2024, this significant inclusion is projected to bring inflows of ₹4,362.35 crore into Zomato while triggering outflows of ₹2,142.91 crore from JSW Steel, as per estimates by brokerage firm Nuvama.
Zomato’s shares have soared, gaining nearly 43% in the past six months and 126% over the past year, driven by improved unit economics in its quick-commerce segment, reinforcing investor confidence. The company reported an impressive 69% year-on-year growth in consolidated revenue, reaching ₹4,799 crore in Q2 FY2024-25, alongside a fivefold increase in net profit to ₹176 crore.
JSW Steel, in comparison, had gained just about 9% over the year.
“Over the past 18 months, as Zomato started to demonstrate its ability to gradually improve unit economics and move towards breakeven and beyond (especially in the qcom segment), the stock rallied by almost 150%,” the report quoted brokerage firm UBS as having said in its latest report.
Brokerage firm Nuvama anticipates significant fund flows as institutional investors rebalance their portfolios to match the revised index composition. Investors plan to inject $513 million into Zomato, demonstrating heightened interest in the tech-driven company. Meanwhile, they intend to withdraw $252 million from JSW Steel as it exits the index.
The food delivery giant’s market cap of ₹2.72 lakh crore surpassed JSW Steel’s ₹2.24 lakh crore.
This milestone underscores Zomato’s remarkable growth and reflects the increasing influence of tech-driven companies within India’s corporate landscape, marking a shift in the country’s economic dynamics.
