Zomato Share Price Hit A Record Low Of ₹46 (14% Drop). But Why?
Zomato shares dropped its all-time low of ₹46 today. But why did this happen? And what is this lock-in period, which ended on 23rd July? Let’s reveal the things!
Zomato Shares: This Monday, July 25, Zomato’s stock dropped by roughly 14% to an all-time bottom of ₹46.
In fact, there has been a significant sell-off in the stock as a result of the expiration of the lock-in period for pre-IPO owners (promoters, employees, and other institutions).
The lock-in period for roughly 613 crore, or 78%, of the shares of online meal delivery startup Zomato reportedly concluded on July 23.
On July 23, 2021, Zomato’s public offering was listed on the BSE and NSE.
Lockin Period for Zomato
Companies without promoters are subject to the lock-in time rule. One of these companies with no promoter ownership is Zomato.
The equity share capital held by the firm prior to the IPO in a company without promoters is legally locked for a period of one year following the allocation of shares, per the laws.
These stockholders are not permitted to sell any of their shares during this period.
Initial Investors of Zomato
Alipay (7.1%), Ant Financial (6.99%), Tiger Global (5.11%), Sequoia Capital (5.10%), and Temasek (3.11%) are among the initial investors in Zomato.
Experts advise investors to monitor the behavior of stockholders like Uber & Delivery Hero after the lockdown period has ended.
Due to concerns about an economic recession, many corporations are already under pressure. As a result, they might think about selling their Zomato stock.
InfoEdge Paid Just ₹1.16 Per Zomato Share
One of Zomato’s original investors is InfoEdge. The Sanjeev Bikhchandani-led business still owns 15.18% of the food delivery business after having collected Rs 357 crore in a public offering last year. It is worth approximately Rs. 6,330 crore.
Zomato’s IPO prospectus states that InfoEdge paid Rs 1.16 per share for the shares it purchased from Zomato.
Also Read: What made Paytm IPO lead to first day fail?
The average acquisition price of the other big stockholders, however, has not been made public by the firm in its filing.