Swiggy and Zomato Share Prices: A New Era for Food Delivery Companies
Shares of Zomato and Swiggy have become a key market focus after the Labour Ministry directed quick-commerce players to remove the 10-minute delivery threshold. This move is expected to have a significant impact on the food delivery industry, and investors are closely watching the developments.
What Led to the Labour Ministry’s Decision?
The Labour Ministry’s decision to direct quick-commerce players to remove the 10-minute delivery threshold was made after concerns were raised about the safety of delivery partners. The ministry has proposed a 90-day annual work threshold as the mandatory eligibility criteria for gig and platform workers to access social security under new draft rules on the Social Security Code 2020.
This move is seen as a positive step towards ensuring the safety and well-being of delivery partners, who are often subjected to intense pressure to deliver food quickly. However, it is also expected to increase the costs for food delivery companies, which may impact their profitability.
Impact on Swiggy and Zomato Share Prices
Shares of Swiggy are trading at Rs 346.6, correcting around one percentage point, while Zomato shares are trading with gains of around 2.5% at Rs 292. The stock prices of both companies have been volatile in recent times, and this latest development is expected to add to the uncertainty.
Despite the challenges, analysts remain bullish on the prospects of Swiggy and Zomato. Out of 28 analysts tracking Swiggy, 24 maintain a ‘buy’ rating, while two recommend a ‘hold,’ and two suggest ‘sell,’ according to Bloomberg data. The average 12-month consensus price target implies an upside of 41%.
Similarly, out of 33 analysts tracking Zomato, 29 maintain a ‘buy’ rating, while four suggest ‘sell,’ according to Bloomberg data. The average 12-month consensus price target implies an upside of almost 30%.
What Does This Mean for Investors?
The removal of the 10-minute delivery threshold is expected to have a significant impact on the food delivery industry, and investors should be cautious in their approach. While the move is seen as a positive step towards ensuring the safety of delivery partners, it may also increase the costs for food delivery companies, which may impact their profitability.
Investors who are looking to invest in Swiggy or Zomato should do their own research and consider the potential risks and challenges. They can also consider stock market news and investing tips to make informed decisions.
Conclusion
The removal of the 10-minute delivery threshold is a significant development for the food delivery industry, and investors should be aware of the potential impact on Swiggy and Zomato share prices. While the move is seen as a positive step towards ensuring the safety of delivery partners, it may also increase the costs for food delivery companies, which may impact their profitability.
Investors who are looking to invest in the Indian stock market can consider Indian stock market news and stock market tips to make informed decisions. They can also consider Nifty today and Sensex news to stay updated on the latest market developments.
