Even when the eternal shares in July rose by 17% and last Friday a new 52-week height of RS 319.80 hit BSE, investment funds were busy booking with an estimated RS 1,700 Crore last month by loading 5.4 crore shares, according to data from Prime Database and Nuvama.
In the meantime, they peaked RS 1,400 crore in Swiggy and understood 3.43 crore shares of the share that has fallen to date by more than 26% years.
The terrarial bet seems to be a classic case to buy the dip and sell the rip. Although Eternal has yielded an excellent return of 14% years to date and has reached new peaks, fund managers seem to believe that the rally has its run. Conversely, Swiggy’s brutal decrease of 26% seems to have created a buying option that institutional investors cannot resist.
Read also | Rich investors follow a sale mantra in Swiggy, 10 other shares. Are you still buying?
Zomato vs Swiggy
Icici Prudential Investment Fund led the Zomato Exodus with RS 810 Crore on sale, closely followed by Mirae Asset’s RS 820 Crore removal. Other major sellers were Kotak and SBI investment fund. However, not all funds came to the sales spree. Axis Investing Fund brought the trend with RS 375 Crore to purchases, alongside Motilal Oswal and HDFC. On the Swiggy Front, the Buying Brigade was led by Mirae Asset, HDFC, SBI MF, Bandhan and Invesco.The Timing. Eternal’s 17% July -after a robust rally of 21% came in June, suggesting that fund managers take a profit after a strong run. In the meantime, Swiggy only managed a profit of 1% in July despite the heavy institutional purchases, which emphasized the current struggles of the share.Read also | Swiggy vs Eternal: Which stock promises a better value after the Q1 show?
What should investors do?
Goldman Sachs stays Bullish on Zomato, increases its 12-month target price to RS 340 from RS 330 and repeats a buy rating with a 25% potential benefit. The investment bank increased its FY26E-30E estimates to 11%, powered by strong demand trends in rapid trade.
“On the back of 1qfy26 results, our estimates of food delivery for food delivery are higher by 1-2%. We increase our FY26E-FY30E Quick Commerce GOV estimates by a maximum of 9% due to strong demand trends,” noted Goldman Sachs.
Jefferies has become even more optimistic and upgrade forever to buy after earlier worries about the competition, turned out to be ‘unfounded’. The brokerage emphasized the considerably positive commentary of management, especially on rapid trade.
“Progress in Q/C suggests that our concerns about competition, which led to the D/G in January 25, were unfounded; we are now U/G to buy,” Jefferies said.
For Swiggy, the street sees a turning brew. Jefferies has upgraded the shares to buy, and noted that “Q1 profitability marked the valley” and expected that the competition was ahead.
“With a break about the expansion of the dark store in ST and relaxation of the competition (Jef View), Q1 -profit The Trog. Swiggy, however, remains susceptible to high volatility due to a low margin base,” the brokerage warned.
Morgan Stanley has reduced “prognoses of consolidated adapted EBITDA losses for F26-28”, while HSBC appreciates the entire Swiggy activities on $ 11.4 billion or RS 430 per share, with only food delivery activities worth $ 8 billion.
((Indemnification: Recommendations, suggestions, views and opinions of experts are their own. These do not represent the views of economic times)
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