Swiggy slumps as widening Instamart losses, broker downgrades weigh

Swiggy tumbled 14.38% to Rs 181.05 on Friday after the company's Q2 FY27 results raised concerns over rising losses and the pace of profitability in its quick-commerce business, Instamart.

The company's consolidated net loss narrowed year on year to Rs 922 crore in the September quarter from Rs 1,092 crore a year earlier. However, the loss widened sequentially from Rs 791 crore in the June quarter. Adjusted EBITDA loss also increased to Rs 760 crore from Rs 695 crore in the year-ago period.

Consolidated revenue from operations increased 36.1% year on year and grew 11.1% sequentially to Rs 7,571 crore in Q2 FY27. However, investors remained concerned about the company's ability to translate revenue growth into improved profitability amid intense competition in food delivery and quick commerce.

Instamart's adjusted core loss (EBITDA) widened to Rs 895 crore in Q2 FY27 from Rs 849 crore a year earlier and Rs 778 crore in Q1 FY27, highlighting the continued cost of expanding its quick-commerce operations.

Analysts also flagged concerns over Swiggy's growth and execution compared with rival Eternal, as well as the time required for Instamart to achieve profitability.

Brokerages lowered their price targets following the results. A foreign broker cut its target price to Rs 330 from Rs 435, while another foreign broker reduced its target to Rs 300 from Rs 435. A domestic broker lowered its target price to Rs 280.

Investors will monitor Swiggy's ability to control operating losses, sustain growth and improve the economics of Instamart as competition in the quick-commerce market intensifies.

Swiggy, founded in 2014, operates food delivery services covering more than 2.7 lakh restaurants across over 750 cities. Its Instamart quick-commerce business operates in 133 cities across more than 20 categories. The company also offers dining and event-related services through Dineout and Swiggy Scenes, alongside newer offerings including Toing and Crew.

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