Why are Swiggy shares falling for the last 3 days? Analysts decode

Swiggy shares falling: According to an announcement by MSCI, Swiggy will be deleted from the Global Standard Indices owing to its foreign ownership limit, triggering potential passive outflows.

Swiggy share price today: Shares of food delivery and quick commerce firm Swiggy, which owns Instamart, came under selling pressure for the third straight day on Thursday as MSCI announced its exclusion from the global standard indices. Also, Swiggy's entry on the National Securities Depository Limited (NSDL) 'red flag' list earlier this week weighed on the stock.

 

The stock opened in the red at ₹265.35 and extended its losses to hit an intraday low of ₹261.35 on the NSE, down nearly 2.5 per cent.

 

The decline marks the third consecutive session of losses, with the stock falling around 7 per cent during the period.

 

 

As the session progressed, Swiggy shares recovered from the day’s low but continued to trade in negative territory at ₹266.30 as of 12:30 PM. Around 20 million shares changed hands, according to the NSE data.

 

ALSO READ: Solar Ind soars 5% |  Stock Market LIVE: Sensex off 300 pts  Why is MSCI deleting Swiggy from Global Standard indices? According to an announcement by MSCI, Swiggy will be deleted from the Global Standard indices owing to its foreign ownership limit, triggering potential passive outflows. The deletion is scheduled to take effect from September 7, 2026, the release said. Accordingly, passive index funds tracking MSCI will have to sell their Swiggy holdings before the deadline. Vinit Bolinjkar, head of research, Ventura, said that analysts estimate this will trigger forced outflows of approximately $340 million.  Besides, FTSE is also reducing the stock's investable weight, which could bring total passive outflows to around $460 million to $500 million, he said.

  Swiggy's IOCC status

 

Earlier in August, Swiggy had secured shareholders' approval to cap its aggregate foreign ownership at 49.5 per cent. This allowed it to qualify as an Indian-owned and controlled company (IOCC). The Indian owned and controlled company status will let Swiggy to directly own and sell inventory through its quick commerce brand Instamart.

 

Swiggy Co-founder, MD & Group CEO Sriharsha Majety, in a latter to shareholders had earlier said that the move could improve margins by about 80 bps. 

Swiggy on NSDL's red flag list 

 Vinit explained that to transition its Instamart business to a higher-margin, inventory-led model, Swiggy recently capped foreign shareholding. As foreign holdings came within 3 per cent of this new maximum limit, the NSDL placed Swiggy on its 'red flag' list on September 1. 

"This effectively restricts FPIs from making fresh purchases, severely limiting buyer demand," he said. 

According to NSDL, a red flag is activated for listed companies when foreign investment falls to 3 per cent or less of the aggregate NRI/FPI limit or the applicable sectoral cap. As per data available on the NSDL website, the aggregate investment in Swiggy stands at 48.97 per cent, against the aggregate permissible limit of 49.50 per cent. Accordingly, the available investment headroom in terms of quantity stands at 14,557,395 shares.

 

 Swiggy fundamentals 

Abhinav Tiwari, senior research analyst at Bonanza, said that Swiggy's removal from MSCI Global Standard indices could lead to short-term selling pressure, but its fundamentals have improved significantly. In Q1FY27, its food delivery GOV grew 17 per cent Y-o-Y to ₹9,490 crore, with Adj. Ebitda margin improving to 3.1 per cent. Instamart GOV grew 40 per cent to ₹7,907 crore, while contribution margin improved sharply to -0.2 per cent from -4.6 per cent a year ago, moving closer to breakeven. Dineout/OOH grew 45 per cent to ₹1,529 cr and turned profitable. 

 

Overall B2C GOV grew 28 per cent to ₹18,926 crore, while monthly users increased 27 per cent to 27.5 million. 

 

"Swiggy remains debt free with ₹14,400 crore cash, providing sufficient liquidity to fund growth. The recent Hero MotoCorp partnership should also support rider availability and reduce acquisition costs," he said.

 Swiggy stock: Technical view 

 

 

Harish Jujarey, AVP, head - technical equity research), Prithvi Finmart, said that Swiggy’s stock price has broadly remained in a consolidation phase with a negative bias. On the technical front, the stock is still trading below all the major moving averages. The key resistance is seen around ₹300, which is also close to the 200-DMA.

 

"In the very short term, the stock may see a recovery towards the ₹300 resistance zone. However, from a medium to long-term perspective, the trend is likely to remain bearish as long as the stock trades below ₹300," he said. 

 

 

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