Zomato Shares Jumps 8% After ONDC Discounts Revision
ONDC is considered as a threat to Zomato & Swiggy like companies as it directly connects customers & restaurants. But recently it announced an incentive revision.
Today’s trading on the BSE witnessed a nearly 8% increase in the price of Zomato shares following reports of the modification of discounts at the Open Network for Digital Commerce (ONDC).
Zomato shares opened at 69.40, up 7.8 percent from yesterday’s close of 67.92, and have since reached an intraday high of 73.20.
Following media reports indicating that ONDC modified its incentive scheme for network members to reduce reliance on discounts for adoption, the stock gained traction.
The updated incentives will take effect on June 1, 2023, succeeding the program that was initially implemented on January 30, 2023.
The current phase of the program will run until June 28, 2023, according to Moneycontrol.
ONDC was deemed a threat to food-delivery companies such as Zomato and Swiggy because it connects restaurants and consumers directly. Simply put, ONDC enables restaurants to sell food directly to customers without a third party (such as Zomato and Swiggy).
ONDC is a platform supported by the government that functions as a network of interlinked e-marketplaces. With ONDC, vendors can directly sell their products to customers.
ONDC was established by the Department for Promotion of Industry and Internal Trade (DPIIT) in 2021 with the intention of giving the Digital India program a boost.
Numerous buyer apps, such as Paytm, Meesho, etc., and vendor apps, such as BoAt and Delhivery, have joined the platform.
ONDC is not a distinct app downloadable from the Play Store. ONDC operates similarly to UPI, meaning it can be incorporated into existing applications such as Paytm, PhonePe, Meesho, etc. ONDC has over 29,000 merchants who sell over 36 million products.
The Zomato stock price reached a 52-week peak of 75.55 on November 14, 2022. The stock price has increased by more than 14% in the current fiscal year.
The company’s total net loss for the March-ending quarter shrank significantly to 188.2 crore due to a 70 percent increase in its overall revenue.
The company’s revenue from business for the most recent quarter was 2,056 crore, compared to 1,211.8 crore for the same period in the prior year.
Also Read:- Zomato Opens 800 Vacancies Amid Global Layoffs
Zomato remains committed to achieving positive adjusted EBITDA and PAT by the end of the fourth quarter of fiscal year 2024. Shares of Zomato gained 4.70 percent to 71.11 on the BSE at 12:30 p.m.
