Mumbai– Shares of food delivery giant Swiggy have tumbled 38.32% so far this year on the National Stock Exchange (NSE), as mounting losses and slowing growth in key business segments continue to weigh on investor sentiment.
The stock closed flat at ₹334.5 on Tuesday but has remained under consistent pressure amid rising concerns over Swiggy’s quick commerce unit and a deceleration in its core food delivery business.
Over the past six months, Swiggy shares have dropped 26.64%, with a 6.05% decline recorded in the last month alone. Although the stock posted a modest 4.29% rebound over the past five trading sessions, analysts caution that the overall outlook remains bearish.
Last month, Bank of America (BofA) downgraded Swiggy’s stock to “underperform,” slashing its price target from ₹420 to ₹325. The brokerage flagged slowing growth in food delivery and increased competition in the quick commerce space as key challenges.
BofA noted that heightened competition from newer players offering aggressive discounts is likely to force Swiggy to ramp up its marketing spend, which could further erode margins.
“This increased competition could lead to higher marketing expenses, steeper platform discounts, and lower delivery charges for consumers,” the firm stated in its March 26 note.
Analysts are also raising concerns about Swiggy redirecting profits from its food delivery operations — once a relatively stable revenue stream — to cover the growing losses in its quick commerce vertical, which is still far from achieving profitability.
In the third quarter of FY25, Swiggy reported a net loss of ₹799 crore, a 39% increase from the same period last year. On a sequential basis, operating losses also widened, with EBITDA (excluding interest, tax, depreciation, and amortization) hitting ₹725.66 crore.
Despite the grim bottom line, Swiggy’s revenue from operations rose 10.9% quarter-over-quarter to ₹3,993 crore, driven primarily by higher contributions from its Instamart service.
The company is expected to announce its fourth-quarter results for FY25 soon. (Source: IANS)
