Zomato and Jio Financial Likely to Enter Nifty50: Stock Price Targets, Inflows & More
Zomato and Jio Financial Services are expected to be added to the Nifty50 index in the upcoming index rejig. The announcement for these changes is anticipated on February 21 and will take effect on March 31, 2025. Based on the average free-float market capitalization from August 1 to January 31, JM Financial predicts these two companies’ inclusion, with BPCL and Britannia set to exit the index.
Stock Inflows and Outflows
According to JM Financial, the inclusion of Zomato and Jio Financial will bring significant inflows into their stocks.
- Zomato is expected to see inflows of $702 million, with around 277 million shares being traded.
- Shares of Zomato have dropped 15% in 2025 so far.
- Jio Financial Services is expected to see $404 million in inflows, with 153.8 million shares exchanging hands.
- However, Jio Financial has dropped 25% YTD in 2025.
In contrast, companies being excluded will face outflows:
- BPCL is expected to see outflows of $240 million, with 4.4 million shares being sold.
- Britannia may face $260 million in outflows, with 79.7 million shares sold.
Jio Financial Services: Growth and Valuation Challenges
Shares of Jio Financial Services jumped over 3.6% to Rs 228.95, valuing the company at Rs 1.45 lakh crore.
- Despite its expansion into mutual funds, insurance, and digital solutions, Jio Financial remains in the growth phase.
- KR Choksey expressed concerns over the company’s volatility in earnings and uncertain near-term outlook, leading to a ‘hold’ rating with a revised target price of Rs 286 (down from Rs 345).
From a technical perspective, Anand Rathi believes the stock is bottoming out near strong support levels.
- A bullish RSI divergence suggests a possible trend reversal.
- Traders are advised to consider going long in the Rs 230-240 range, with an upside target of Rs 305.
Zomato’s Challenges and Outlook
Zomato’s stock performance remains under pressure, especially with its Q3 earnings falling below expectations.
- Investments in Blinkit and higher employee expenses contributed to weaker results.
- Macquarie views Zomato as an efficient food delivery platform but has an ‘underperform’ rating with a target price of Rs 130, citing rising competition in the sector.
Meanwhile, Nuvama Institutional Equities believes that Blinkit’s growth will outpace expectations.
- While profitability may face delays due to upfront costs for new dark stores, these costs will eventually lead to higher profitability in future quarters.
- The brokerage has a ‘buy’ rating with a target price of Rs 300.
Both Zomato and Jio Financial Services are set to be included in the Nifty50 index, but their near-term outlooks show mixed results. Zomato faces pressure from competition and increased costs, while Jio Financial Services continues to scale its operations but faces challenges in earnings volatility. Analysts recommend cautious optimism, with Zomato facing price targets as low as Rs 130 and Jio Financial Services offering potential upside if its earnings stabilize.