Zomato is a story of profitless prosperity: Ajay Bagga

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Markets have been stuck in a range and may remain range bound for some more time to come. Experts suggest it will be unrealistic to expect markets to give about 100% return like last year and therefore one may need to moderate expectations going forward.

Market Veteran Ajay Bagga spoke to Money9 and said, “This is not the market to go aggressive at these steep valuations.”

He also shared how huge inflows by FIIs in the markets have peaked out. We are seeing outflows now and one will have to keep an eye on the global markets because if a global selling takes place, India will not be spared too.

On the new age digital technology companies making a beeline to launch IPOs especially with Zomato clocking in one lakh crore market cap on debut, he said, “This is profitless prosperity. Global listings of food delivery apps have shown us the that private equity players are having the biggest laugh. There is no roadmap of profitability anywhere on the horizon. Zomato is just an app with no assets. Of course good management and intellectual rigour. It is highly overvalued.”

However, he does believe there may be a few Amazons and Alphabets which may arise of this new age of digital companies but investors really need to be cautious and not get carried away with the fear of missing out.