Swiggy’s Instamart Turns A Corner |
Swiggy’s Instamart Turns A Corner
The foodtech giant cut losses in Q1 FY27, but growth worries and mixed signals kept the streets unconvinced
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The quick commerce industry in India got a reality check this week as Zepto’s IPO plans were put on hold. Amid this, Swiggy’s Q1 FY27 financials may come as something of a relief for those who were watching this space. Not entirely though.
At a first glance, the results look encouraging. Swiggy reported a narrower consolidated adjusted EBITDA loss, its quick commerce arm Instamart hit contribution margin break-even for the first time.
Despite this, Swiggy has been sending mixed signals to the market with respect to the guidance on profitability timeline and growth plans, which is likely to impact investor sentiments further, even as Zepto’s pause in IPO plans according to the market analysts may cushion Swiggy against further valuation erosion in near term.
“They’ve been giving guidance back and forth. While the earlier guidance from the company had stated focus on contribution profitability, which did happen this quarter. Now they are back on increasing the growth guidance and saying that profitability won’t come for the two quarters.,” Karan Taurani, executive vice president at Elara Capital, told Inc42.
Market observers we spoke to stated that if Swiggy pushed to tighten its unit economics to turn Adjusted EBITDA positive in next few quarters, the consumer tech firm may risk losing market........