Blinkit, Instamart raise dark-store capex as qcom shifts to larger hubs

Capex guidance per dark store has risen to around ₹2.5 crore from ₹1 crore as newer facilities exceed 5,000 sq ft and carry wider product assortments

Quick commerce (qcom) companies like Eternal’s Blinkit and Swiggy’s Instamart are significantly increasing capital infusion into their dark stores. This comes as the industry shifts towards larger fulfilment centres and wider product assortment.

 

According to a UBS report, both companies have raised their capital expenditure (capex) guidance per dark store to around ₹2.5 crore from the earlier estimate of ₹1 crore provided nearly two years ago.

 

Based on the report, stores of around 2,500-3,000 sq ft currently cost around ₹1.4-1.6 crore, while a 5,000 sq ft store can come for ₹2.4-2.5 crore. In addition, a 7,000 sq ft facility can cost around ₹3 crore, including the apportioned cost of warehouse infrastructure.

  

The expansion in store sizes marks a shift from the earlier model, where qcom players largely operated 2,000-3,000 sq ft dark stores.

 

UBS said that newer dark stores are increasingly coming in formats of more than 5,000 sq ft, representing a 60-100 per cent increase in store size over the past one to two years.

 

As the size of dark stores increases, they can hold more reserve inventory and long-tail stock-keeping units (SKUs) locally, thereby reducing replenishment frequency. Consequently, the report estimates that the warehouse area multiple will decline from 1.0x for 2,500-3,000 sq ft stores to 0.8 times for a 5,000 sq ft store and 0.6 times for a 7,000 sq ft store.

 

The shift is also changing the role of dark stores. Rather than functioning purely as small neighbourhood delivery points, newer facilities are built up as mini fulfilment centres, with greater space allocated for inventory, picking, packing and staging.

 

“As order volumes increase, dark stores require more picking aisles, packing stations, rider handover points and staging areas to prevent congestion and maintain delivery service level agreements (SLAs). In other words, dark stores are increasingly designed as high-volume fulfilment centres rather than simply inventory-holding locations,” the report said.

 

The higher capital intensity could, however, increase the funding required for network expansion. But larger stores could improve throughput and utilisation, potentially supporting better unit economics as order volumes scale.

 

The report concluded that the move towards larger stores is driven by increasing competition around assortment rather than just delivery speed.

 

Companies are expanding their product selection and adding categories such as electronics, beauty and other long-tail products.