Zomato's share price surged over 7% following an unexpected net profit announcement in Q1FY24.

The stock hit a 52-week high of ₹102.85 per share, crossing the ₹100 mark for the first time since January 25, 2022.

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The rally was largely driven by enthusiasm over the positive Q1 results, but experts caution that challenges remain for sustained positive EBITDA.

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Avinash Gorakshakar from Profitmart Securities notes that Zomato's rally is backed by optimism about improved Q1 results, but long-term challenges persist.

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Sudip Bandyopadhyay, Group Chairman of Inditrade Capital, acknowledges Zomato's direction but remains cautious due to valuation concerns.

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Zomato reported a surprising net profit of ₹2 crore for Q1FY24, a significant improvement from a ₹186 crore loss in the previous year.

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The company's Q1FY24 revenue rose to ₹2,416 crore from ₹1,414 crore in the same period of the previous year.

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Seasonal factors like the summer holiday season and the IPL cricket tournament contributed to Zomato's 11% QoQ growth in Q1FY24.

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Analysts offer diverse opinions on Zomato's future, with Nomura cautious and Motilal Oswal expecting strong growth and positive EBITDA by Q4FY24.

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