Analysts remain bullish on the road ahead for Swiggy’s stock that debuted on the bourses on Wednesday. Global brokerage firm Macquarie remains highly optimistic and has set a price target of Rs 700 on the stock from a long-term perspective.
Macquarie said Swiggy has a clear path to catch up with leader Zomato in food delivery. The Swiggy stock made an impressive market debut, listing at Rs 412 on the BSE and Rs 420 on the National Stock Exchange, marking premiums of 5.64 per cent and 7.69 per cent, respectively, over the IPO issue price of Rs 390. By comparison, the Nifty and Sensex ended the day in the red.
“Despite a strong potential growth runway and an improving margin profile, we believe Swiggy still has a long and winding road to profitability. However, even as peer Zomato is the more efficient operator when considering what is priced in the shares, we prefer Swiggy over Zomato,” said analysts at Macquarie in their research note.
Macquarie, however, has initiated its coverage with an underperform rating on Swiggy stock from a short-term perspective and assigned a target price of Rs 325 per share.
“Our DCF-based target price (TP) of Rs 325 implies an equity valuation of $9.2 billion (WACC 11 per cent). In a ‘blue-sky’ growth scenario and if Swiggy can prove Instamart’s unit economics, we see a path to Rs 700 fair value,” wrote Aditya Suresh and Baiju Joshi of Macquire in their research note.
Key catalysts, according to them, include improvement in Instamart’s profitability, acceleration in Monthly Transacting User (MTU) additions, and reversal of market share losses.
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Though analysts at JM Financial, too, have initiated coverage on Swiggy with a ‘buy’ rating, they prefer Zomato from a short-to-medium-term perspective, given its superior execution in the past and market leadership across key segments. From a tactical standpoint, they recommend investing in both forms with a higher weighting for Zomato.
Both Swiggy and Zomato are likely to be among the fastest-growing consumption names and could, therefore, outperform the broader market returns, they said.
JM Financial’s analysts used the multiples-based SOTP method to value Swiggy, with each of its segments valued based on either Ebitda, GMV, or sales multiples.
“These multiples are 10-50 per cent lower than those used to value Zomato’s segments due to differences in scale and profitability. Despite this discount, our March 2026 target price for Swiggy works out to Rs 470, indicating a 6 per cent upside. We recommend ‘buy’ rating”, wrote JM Financial analysts in the research note.
From an operational perspective, Swiggy is the second-largest food delivery and quick commerce company in India, with around 47 million annual transacting customers on its platform as of last financial year (FY24). Apart from its online delivery segments, it also has a B2B supply chain and distribution vertical, which caters to wholesalers and retailers. It also runs a membership programmes (Swiggy One) that provides exclusive delivery and dining-out offers.
According to Astha Jain, senior research analyst at Hem Securities, Swiggy’s listing was in line with their expectations. She recommended that investors who were allotted the company’s shares book a partial profit from the listing gains, given the disappointing prevailing market conditions. For investors willing to invest in Swiggy, Jain advised waiting for the price to settle to get a clearer picture.
“Although Swiggy’s unit economics and contribution margin are currently lower than Zomato's, their strategy is superior. If their strategies materialise, Swiggy will likely see strong financial performance in the long run,” Jain said.