Namaste!
For the people who has conviction in Zomato's future, this is the best time to buy shares (based on my analysis). You can consider investing 5% of your capital only. Never ever sell your investments at a loss. Zomato can be considered as a "beaten dog". One of the reason it has fallen so much, is due to sell-off in US Tech companies (Netflix, FB, Etc). Buying after a correction is always a best choice because it has more reward potential. And you are not putting all the eggs in one basket. So, eventually, your diversified basket would beat the market (Nifty returns) over a period of time.
Buying price: If it moves above Rs 60.50 or any next weekly red candle created and closed, buying at high of such candle.
Disclaimer: I am not a SEBI certified investment advisor. The facts and suggestion given in the above article is based on my understanding and experience in the markets. Please consult your financial advisor before investing.
For the people who has conviction in Zomato's future, this is the best time to buy shares (based on my analysis). You can consider investing 5% of your capital only. Never ever sell your investments at a loss. Zomato can be considered as a "beaten dog". One of the reason it has fallen so much, is due to sell-off in US Tech companies (Netflix, FB, Etc). Buying after a correction is always a best choice because it has more reward potential. And you are not putting all the eggs in one basket. So, eventually, your diversified basket would beat the market (Nifty returns) over a period of time.
Buying price: If it moves above Rs 60.50 or any next weekly red candle created and closed, buying at high of such candle.
Disclaimer: I am not a SEBI certified investment advisor. The facts and suggestion given in the above article is based on my understanding and experience in the markets. Please consult your financial advisor before investing.
Comment:
Generally, investors and venture capitals look at the increasing sales figures to analyse value of the company. Whereas, decreasing losses make more sense to me for valuing a loss making company. Decreasing losses since consecutive 3 years is a good indication and time to invest in. Zomato has decreasing losses (EPS) since last 2 years, 1 to go.
Comment:
Zomato is creating a "double bottom pattern" on weekly charts. Its a reliable bullish indicator and this stock may see a bullish rally in couple of months provided IT sector stays bullish.
Comment:
Start-ups (like Zomato, PayTM, Nykaa, etc) are valued on future EPS expectations. Like Zomato hasn't made any profits yet, but considering its market share in India, it could do in future. So, what does the current price of Rs 53 say? Well, I generally compare with average 20 P/E for all companies. So, the price of Rs 53 says, "Zomato should/might be making EPS of Rs 2.65 (current Rs -0.46) in the coming 2-3 years". There is a fact in choosing a 3 year number because 3 years is a common time-frame for investors, after that "they lose their patience".
Comment:
There are two types of corrections, one is price-correction and two is "time-correction". Price correction is normal correction (falling stock prices) but time correction is when price of the stock "remain in range for months or years". Time correction is very crucial for any bull market as bull market often succeeded by time corrections most of the time based on history. A very good example of time correction is Reliance Industries' stock price, it was range-bound for 9 years (Jan 2008 to Aug 2017).
Trade closed manually:
Selling Zomato at Rs 115 is a good idea. You should do your analysis and/or consult your financial advisor before taking any action.
Comment:
I expect anyone who is reading my writings to know that there is nothing "certain" in the markets. Neither the %gain on stock nor "out-performance" or "under-performance". There is a risk and opportunity cost involved in both, buying and selling. Selling at any price can often result in "opportunity loss" when the stock moves higher and higher. Human psychology is a culprit here. For e.g. I post any stock which seems undervalued or overvalued to me on tradingview. When anyone makes money on that, they wont appreciate me "a single word". But when they lose or it results in opportunity loss, they are bound to blame me. I don't criticize any person, because I know their psychology has defeated them. At last, there is nothing like "easy money" in the markets. The survival of the fittest holds absolutely true here.