The shares of food delivery aggregator Zomato hit a record high in early trade on September 13 but fell almost 3% from those levels intraday.

Global brokerage Bernstein, however, has an outperform call on the stock and has raised its target price to ₹330 from ₹275 earlier. This implies it sees a potential upside of 16% in the Zomato share price from the closing of September 12.

Bernstein is of the view that Zomato is prioritising long-term leadership over short-term profitability and it likes the strategy and update estimates for BlinkIt upwards.

The brokerage house believes quick commerce is a compelling product and all consumers are embracing it, and Zomato remains at the centre of the convenience.

Earlier this week UBS in its report pointed out that on a month-on-month basis, Zomato’s order growth of 1.8% lagged Swiggy’s 3.1% in August continuing a trend of monthly push and pull since the start of 2024. However, when Zomato’s August 2024 volumes are compared with December 2023, the growth stands at 25% compared to Swiggy’s 18% gain.

UBS has given Zomato a buy rating with a target price of ₹320.

In a separate report, Elara Securities India said that its primary checks suggest there is a likelihood that quick commerce companies may be able to scale up in non-metros, which would bolster their growth prospects in the medium to long term.

“We continue to believe qCommerce is a user experience-led moat for market leaders like Zomato’s Blinkit; however, any regulation to cap discounts may have a negative impact on growth rates; in contrast, adoption of qCommerce beyond non-metros with sustainable profitability will drive growth rates of 70-80% for the medium to long term,” it said.

From a technical point of view, Axis Securities in its note on September 12 said, that Zomato exhibited a strong breakout above the consolidation zone between 280-249, marked by a decisive bullish candle on the weekly chart, reinforcing the continuation of the medium-term uptrend.

Zomato shares traded almost 2% lower at ₹278.40 on NSE at 11:15 am. The stock has given a return of 124% to its investors in 2024 (year-to-date) as against the benchmark index Nifty 50 which has risen almost 17% during the period.

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