Consumer tech stocks businesses that went public between late 2021 and early 2022 and were brutally hit following their listing are experiencing a strong rebound on the stock exchanges, with returns of up to 46% in the most recent fiscal year. The euphoria surrounding these firms has persisted, and analysts and investors now have a greater grasp of their operations, despite the fact that most are well below their initial public offering (IPO) prices. According to brokers, these businesses are also experimenting with novel ideas that are yielding fruitful outcomes and boosting stock prices on exchanges.
“The overvaluation of the IPO in 2021 and the subsequent correction in 2022 were both driven by factors external to the businesses,” said Ravi Srivastava, partner and head of research at Bay Capital Investment Advisors.
Also read, BSE mcap hits record Rs 295 lakh crore on foreign funds’ buying spree.
Statement on Consumer Tech Stocks:
“Today, there is a deeper understanding of these organizations in the public market, and their fundamentals are what the market is following and reacting to. Think about these: Zomato, a prominent provider of food delivery services that went public in July 2021 at a price of Rs 126, dropped to a low of Rs 41 and is now trading at Rs 74, or about its IPO price of Rs 76. In FY24, the stock is up 46%. In the current fiscal year, other consumer tech stock companies have also recovered. Recently, a number of brokerages have also published favourable evaluations on a few of these businesses. The majority of these have increased their target prices in response to analyst reports indicating the management was hitting goals, reducing expenses, and putting new initiatives in place to boost income.
According to a recent ICICI Securities (I-Sec) study on Paytm, the company is experiencing an encouraging cycle of client growth, retention, and cross-selling. Growth is aided by the on boarding of more customers and the expansion of use cases. The new, technologically superior platform, which has 10 times as many transactions as the existing volume, could be a significant advantage. Paytm’s “ability to grow, retain, and cross-sell as illustrated should give the investor confidence in the wake of possible changes in the payment landscape,” according to analysts at I-Sec. “Integrating credit cards into UPI and increasing platform monetisation could lead to positive surprises in the future,” it added. The brokerage firm set a target price for the shares of Rs 1,055.
These are just a few of the examples of consumer tech stocks companies growing and recovering, but it is definitely good news for the consumer tech stocks holders.
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