A DIY Valuation of Zomato

Aswath Damodaran provides a framework for valuing Zomato ahead of its IPO, emphasizing that valuation is storytelling grounded in common sense rather than expert mystique. He decouples the concepts of good companies versus good investments, and offers a DIY spreadsheet tool allowing readers to input their own assumptions on market size, market share, revenue slice, margins, reinvestment, and risk to arrive at their own valuation. The article demonstrates that most plausible stories yield valuations between ₹30–₹60 per share, well below the market price of ₹140, and distinguishes between investing (value-based) and trading (momentum-based) approaches.