The shares of the food tech major Zomato tumbled more than 5 per cent during intra-day trades after Macquarie maintained an underperform rating on the stock with a target price of ₹96 because of increased competitive intensity.

The counter, however, managed to recover a large part of the losses, but still closed in the red.

It settled at ₹178.90, a fall of 0.91 per cent over the last close after crashing to the day’s low of ₹171.25, a drop of 5.15 per cent.

A report by brokerage Macquarie on a possible entry of Reliance Retail in quick commerce rocked the Zomato stock.

Macquarie said JioMart operated by Reliance Retail is reportedly preparing to launch services with sub-30 minute deliveries.

The Reliance arm will initially provides these services in eight cities and expand it subsequently to 18-20 cities in Phase 1.

According to the brokerage, multiple incumbent e-commerce platforms have announced renewal ambitions in quick commerce.

While Blinkit — Zomato’s quick commerce unit — is an efficient operator, the brokerage sees “downside to consensus forecasts and margins for Blinkit’’.

The target price of ₹96, is 47 per cent lower than the previous closing price of Zomato.

Zomato had reported a consolidated net profit of ₹175 crore in the January-March 2024 quarter following higher revenues. It had posted a consolidated net loss of ₹188 crore in the same quarter last fiscal.

Consolidated revenue from operations stood at ₹3,562 crore against ₹2,056 crore in the year-ago period.

The quarter saw its margin expansion continuing in both food delivery and quick commerce.

Zomato MD and CEO Deepinder Goyal had said the gross order value growth in food delivery business was strong at 28 per cent despite the softness in the overall restaurant industry .