Swiggy shares rise 4% as firm plans to raise funds via QIP; analysts see upside potential

Along with its Q2 earnings, the quick commerce platform said its board of directors will meet on November 7 to consider fundraising of up to ₹10,000 crore through qualified institutional placement (QIP).

“The external competitive environment is dynamic, and legacy and new players continue to attract investments to the sector. This has necessitated a conversation with the Board to consider an additional fundraise which will give us access to sufficient growth capital while enhancing our strategic flexibility,” Swiggy said in a regulatory filing.

At 9:54 AM, Swiggy shares were trading at ₹424 apiece on NSE, rising 1.45%.

The food and grocery delivery major’s net loss widened by 74.44% year-on-year (YoY) to ₹1,092 crore during the quarter under review, compared to ₹626 crore in the second quarter of the 2024-25 fiscal year (Q2FY25).

The company, however, witnessed a 54.43% YoY increase in its revenue from operations to ₹5,561 crore in Q2 of FY26, as against ₹3,601 crore in the corresponding quarter of the previous fiscal year.

At an operational level, its EBITDA (earnings before interest, tax, depreciation, and amortisation) reported a loss of ₹798 crore during the quarter, compared to ₹554 crore in the September quarter of FY25.

Swiggy’s food delivery business’ gross order value (GOV) continues to grow in line with guidance at a healthy 18.8% YoY, to ₹8,542 crore, despite volatile macro-consumption trends and higher-than-usual rainfall. The growth was driven by competitive action and the scope expansion of subscription programmes.

“Despite the recent narrative on platform fee hikes, the total cost of service for users (delivery fee + platform fee + cost of membership programme) has remained 5-6% of AOV over the last 3 years, underpinning our focus on affordability,” Swiggy said.

The Swiggy platform’s average monthly transacting users (MTU) stood at 22.9 million, up by 34% YoY and 6.1% sequentially.

The company’s quick-commerce business’ GOV stood at ₹7,022 crore, showcasing an accelerated 107.6% YoY growth. The segment added 40 dark stores to reach 1,102 stores across 128 cities, it said.

The quick commerce segment’s average order value surged by approximately 40% YoY to ₹697 crore, led by continued expansion of non-grocery selection and larger-basket buying behaviour across user cohorts.

What the management said

Commenting on the earnings, Sriharsha Majety, MD and Group CEO of Swiggy, said: “Swiggy’s food delivery business delivered another quarter of robust growth and improved profitability, with the double-digit YoY order growth at the highest in 2 years. This was led by acceleration in user growth on the back of new propositions like Bolt, 99-Store, Deskeats, and health-focused curations, all aimed at covering the entire breadth of user expectations.”

“Instamart made giant strides in catering to all purchase missions through Maxxsaver (grocery) and Quick India movement (non-grocery), driving up AOV 40% YoY. A ~200 bps QoQ contribution margin improvement showcases our commitment to drive scale-led, sustainable and profitable growth in quick commerce, led by best-in-class speed and selection," Majety added.

What analysts said

Global investment firm Jefferies expects strong growth in Swiggy’s food delivery business, supported by continued margin expansion. It noted that a sharp rise in average order value (AOV) was a key highlight in the quick commerce segment, along with an improvement of around 200 basis points (bps) in quarter-on-quarter (QoQ) contribution margin. However, Jefferies pointed out that Swiggy’s absolute EBITDA loss remains elevated.

The brokerage added that achieving profitability in the quick commerce segment will require a higher take rate, as per Jefferies estimates (JEFe), along with improved network utilisation.

Nomura, in its note, said that Swiggy’s planned fundraise of ₹10,000 crore would help strengthen the balance sheet and support its quick commerce business. The brokerage expects the company to maintain strong growth momentum in food delivery, projecting 19–20% year-on-year growth in gross order value (GOV) for FY26–27F, with contribution margins in the range of 7.5–7.7%.

CLSA said Swiggy’s Q2 performance was mixed, with Instamart showing better contribution per order but slower order growth and customer additions. Food delivery also saw higher take rates but slightly weaker contribution and EBITDA than expected. While Swiggy made progress, CLSA noted that its execution gap with Zomato widened this quarter.