Shares of Zomato rallied nearly 9% in early deals on Tuesday in an otherwise weak broader market after the food delivery company reported a decline in its financial losses during the April-June quarter of the current financial year. The Deepinder Goyal-led restaurant aggregator posted a consolidated net loss of ₹185.7 crore in June quarter of 2022 (Q1 FY23), compared to a loss of ₹356.2 crore a year ago and ₹359.7 crore in the previous quarter. The foodtech unicorn saw its consolidated revenue from operations rising 67% to ₹1,414 crore during the quarter under review on the back of strong order volumes and a slight improvement in average order values. On a quarter-on-quarter basis, its revenue grew by 16% from ₹1,212 crore in the March quarter of 2022 (Q4 FY22).

Boosted by improvement in Q1 earnings, the share price of Zomato opened higher with a gain of 7.87% at ₹50, against the previous closing price of ₹46.35 apiece on the BSE. In the first hour of trade so far, the large cap stock surged 8.85% to hit a high of ₹50.45, driven by strong volume trade. As many as 219 lakh shares changed hands over the counter on the BSE as compared to the two-week average volume of 150.28 lakh stocks. The market capitalisation of the company climbed to ₹39,289.54 crore. In sharp contrast, the BSE benchmark Sensex was trading 312 points lower at 57,802 levels at the time of reporting.

Zomato has had a bumpy ride since its listing on Dalal Street on July 23, 2021. The stock was listed at a 51% premium over the issue price of ₹76 per share on the BSE. The homegrown food delivery platform currently trades 70% lower than its life-time high of ₹169.10 touched on November 16, 2021. It hit an all-time low of ₹40.55 on July 27, 2022 amid concerns about valuations and future growth prospects.

Zomato's share price has fallen more than 64% in 2022, from ₹141.35 on January 3 to ₹50.45 in intraday today. The stock, however, has gained momentum in the recent past, with share price surging nearly 21% in the last one week.

Despite record slump in share price, foreign brokerage firms Jefferies and Credit Suisse remained bullish on Zomato even after the stock touched a fresh all-time low of ₹40.55 last week, below the ₹41 level projected by valuation guru Aswath Damodaran last year.

Last week, Jefferies said it remained bullish on the stock, with a target price of ₹100, indicating an upside of more than 100%. "Blinkit acquisition elongates the path to profitability and despite management guidance on a break-even in food delivery, investors are not giving much benefit of doubt," the brokerage said in its report.

Credit Suisse also maintained its 'outperform' rating on the stock, with a target of ₹90, saying that the foodtech major is on a clear road to profitability growth.

In a fresh development, Zomato has planned to move to a multiple CEO structure, as per a slack message sent to employees by Deepinder Goyal, the CEO and MD of the company. “We are transitioning from a company where I was the CEO to a place where we will have multiple CEOs running each of our businesses (Eg: Zomato, Blinkit, Hyperpure, Feeding India), all acting as peers to each other and working as a super-team with each other toward building a single large and seamless organisation,” Goyal said in the message.