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The stock has been under pressure since January 21, which is when its other listed rival Zomato Ltd. reported its December quarter results.
Zomato had flagged off a slowdown in the food delivery business and also mentioned that its Quick-Commerce Vertical “Blinkit”, will remain loss-making for the near-term as it accelerates its investments in expanding its dark store network.
It will be interesting to see whether Swiggy also makes any such commentary during its quarterly results.
Shares of Swiggy, which were already in correction mode from their post-listing highs, fell further post Zomato’s results. On January 28, the stock fell below its IPO price of ₹390, making a low of ₹389.
Kotak Institutional Equities had initiated coverage on Swiggy on Monday with a “buy” rating and a price target of ₹500.
The brokerage said that Swiggy’s food delivery margin will improve and that will drive an Adjusted Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) Compounded Annual Growth Rate (CAGR) of 62% over financial year 2025-2028 for the segment.
However, it said that Quick Commerce will entail investments to support infrastructure growth and customer acquisition.
Out of the 16 analysts who have coverage on Swiggy, 11 of them have a “buy” rating, two say “hold”, while three have a “sell” rating on the stock.
Shares of Swiggy are trading 4% lower at ₹416.8 ahead of its results announcement.
First Published: Feb 5, 2025 10:42 AM IST