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In its note, Bernstein said that Swiggy pioneered food delivery in 2014, later expanding into quick commerce. It is now the second-largest hyperlocal platform in India, after Zomato.
The foreign brokerage believes Swiggy will be one of the key winners in India’s convenience economy, which has an 8% penetration and a $70 billion total addressable market (TAM). It is expected to benefit from a structural shift toward super-fast delivery models in one of the fastest-growing markets globally, with a projected CAGR of over 50%.
Although Swiggy’s market share has declined by 4% over the last three years, Bernstein expects market share stabilisation at 42%, supported by better customer acquisition and innovative product launches, such as Bolt and Swiggy One Lite.
Bernstein also forecasts that Swiggy’s adjusted EBITDA margins will expand from 1.2% in Q2FY25 to 4% by FY30, in line with Zomato’s margin expansion trajectory.
Out of the 12 analysts that now have coverage on Swiggy, seven of them have a ‘Buy’ rating on the stock, two of them say ‘Hold’, while the other three have a ‘Sell’ rating.
The Bernstein note comes just a few days after JPMorgan initiated coverage on Swiggy with a ₹635 price target. Earlier, Axis Capital had also initiated coverage on Swiggy with a ₹640 price target. That note had triggered a 12% jump on the stock.
JPMorgan said that it expects Swiggy to catch up across both food delivery and the Quick Commerce segments, owing to a renewed focus and improved execution. It expects Swiggy to be an “underappreciated winner” in India’s local service ecosystem.
Shares of Swiggy Ltd. had ended 3.44% lower on Wednesday at ₹491.75. The stock has made a post-listing peak of ₹617.30.
