Rivalry on D-Street: Is Swiggy IPO a threat to Zomato's blockbuster run at the bourses?
Zomato is set to spill over onto Dalal Street, with both companies likely competing to capture investor interest.
With a market share of around 58% in the food delivery business and 40-45% in quick commerce, Zomato is currently the market leader in both segments. However, the competitive landscape could shift once Swiggy hits the public market and improves its performance under heightened scrutiny.
Once dismissed as overvalued due to its losses, Zomato has staged a remarkable financial turnaround, posting four consecutive profitable quarters and achieving positive EBITDA in its quick commerce business. This has led to a sharp rally in its stock, which has surged as much as 120% this year.
Meanwhile, Swiggy remains in the red, with a loss of Rs 2,350 crore in FY24. Zomato has also significantly outpaced Swiggy in key metrics like gross order value (GOV) and average order value (AOV).
During FY22-FY24, Zomato’s food delivery segment posted a GOV CAGR of 23%, compared to Swiggy’s 15.5%. Additionally, Blinkit's GOV was 54% higher than Instamart’s in FY24.
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