IPO-bound food tech major Swiggy expects Instamart, its quick commerce arm, to soon outpace its core food delivery business as demand for instant convenience grows in India’s cities.
At a press conference discussing Swiggy’s impending initial public offering (IPO), the company said that given how consumers are placing a higher value on convenience, especially in urban metros, its quick commerce offering Instamart has been seeing a sharp rise in the number of users as well as transaction volumes.
Quick commerce has reached 40% of ‘s food delivery business in terms of gross order volumes—a feat it achieved within just four years of launch. The company is projecting that Instamart’s growth will soon surpass that of food delivery, its primary offering.
As of June, Instamart operated more than 550 dark stores across major cities in India. It plans to increase the number of dark stores to 741 by expanding to newer cities as well as increasing density in cities it is already present in, the company said in its draft red herring prospectus. To expand its dark store network, Swiggy has earmarked an investment of Rs 755.4 crore and set aside an additional Rs 423.3 crore for lease payments.
Swiggy’s investment in quick commerce arrives amid intensifying competition from rivals like Zomato-owned Blinkit and General Catalyst-backed Zepto, which are actively raising capital to fuel growth.
Earlier this month, ’s board approved plans for an Rs 8,500-crore fundraise via a qualified institutional placement (QIP), while Zepto, valued at $4.6 billion, is reportedly seeking another $100-150 million from domestic family offices and high-net-worth individuals.
Swiggy’s IPO—a much-awaited listing this year—opens for subscription on November 6. The company plans to raise Rs 4,499 crore through the fresh issue of shares. The OFS segment will see existing shareholders, including promoters, tendering around 175 million shares.
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