IPO-bound Swiggy 4-6 quarters at the back of Zomato in key metrics, says Macquarie – Trade Information

By Raghav Aggarwal

Swiggy, which plans to go public in November, is “4-6 quarters behind” its rival Zomato in key metrics within the food delivery and quick commerce sectors, according to a report by Macquarie titled “Head-to-Head: Zomato versus Swiggy”.

In the food delivery segment, Swiggy’s gross order value (GOV) is around 27% lower than Zomato’s, the report said. For Q1 FY25, Swiggy recorded a GOV of $820 million, compared to Zomato’s $1.116 billion. This gap has widened over time: in FY23, Swiggy’s GOV of $2.66 billion was 18% lower than Zomato’s $3.26 billion, but by FY24, the difference had increased to 23%.

The report also highlighted user engagement differences, noting that Zomato had over 20 million monthly transacting users (MTUs) in Q1 FY25, while Swiggy had 14 million. Despite the disparity in user base, both platforms have similar order frequency and average order value (AOV). Swiggy slightly outperformed Zomato in orders per month, with 3.7 orders versus Zomato’s 3.6. AOVs were also close, with Zomato’s at Rs 425 and Swiggy’s at Rs 436.

In the quick commerce segment, Macquarie noted that Blinkit, owned by Zomato, is “much ahead” of Swiggy’s Instamart. In Q1 FY25, Blinkit had 7.6 million MTUs, whereas Instamart lagged behind with 5.2 million MTUs, about 32% fewer users. This is a shift from FY23, when Instamart had 8% more monthly users than Blinkit’s 3 million.

“Transacting user growth at Blinkit has sharply accelerated in the past five quarters,” the brokerage said.

“Transacting user growth at Blinkit has sharply accelerated in the past five quarters,” the brokerage reported. Additionally, Blinkit leads Instamart in terms of AOV and GOV. In Q1 FY25, Blinkit’s AOV was Rs 625 per order, 22% higher than Instamart’s Rs 487. Blinkit’s GOV for the quarter reached $593 million, surpassing Instamart’s $328 million by 45%.

According to the report, both companies have a similar number of dark stores but “Blinkit’s throughput (GOV per store) is higher which in turn drives down dark store operations costs”. At the end of Q1FY25, Blinkit had 572 dark stores and Instamart had 557.

Overall, according to the brokerage, “Swiggy lags on GOV by roughly 25 per cent or by about six quarters at the current pace of growth”.

To catch up with Zomato, Macquarie said that Swiggy needs to expand its MTU. However, in the quick commerce business, work needs to be done on increasing AOV, reducing discounts and increasing the contribution of ad revenue.

Swiggy is aiming to raise up to Rs 3,750 crore via a fresh issue of shares, coupled with an offer for sale for up to 18.5 crore equity shares. It is aiming for a valuation of around Rs 83,365 crore.