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.

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

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

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

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

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

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

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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