India’s leading food delivery and quick commerce platform, Swiggy, witnessed a sharp decline in its stock price on 13 May 2025, falling more than 7% to ₹297, marking its 52-week and all-time low. This drop came in the wake of the expiry of the six-month lock-in period for pre-IPO investors.
While the stock managed to recover slightly to close at ₹302.7, the overall sentiment around Swiggy remains negative, driven by not just the lock-in expiry but also concerns over rising losses, high cash burn, and stiff competition.
What Triggered the Stock Crash?
The primary reason behind this dramatic fall was the expiry of Swiggy’s IPO lock-in period, which allowed non-promoter pre-IPO investors—including venture capitalists, private equity firms, and other early-stage backers—to finally sell their holdings. This event unlocked around 83% of the total shareholding, amounting to nearly 189.75 crore equity shares, translating to a market value of ₹62,000–₹66,000 crore (approximately $7.7–$8.2 billion).
This sudden surge in liquidity created immense selling pressure, pushing the stock to its lowest levels since its IPO.
Key Stats:
- Stock Low: ₹297
- Listing Price: ₹390 (November 2024)
- Current YTD Fall: 44%
- IPO Valuation: $11.3 billion
- Trading Volume on 13 May: 12.55 million shares (vs. 20-day avg of 10.57 million)
Q4 FY25 Financials: Growing Revenue, Widening Losses
While Swiggy is aggressively expanding its market presence, especially in the high-growth quick commerce segment, its financials have raised eyebrows.
Q4 FY25 Performance:
- Revenue from Operations: ₹4,410 crore (up 45% YoY)
- Net Loss: ₹1,081 crore (vs. ₹554 crore in Q4 FY24)
- Total Expenses: ₹5,609.6 crore (up from ₹3,668 crore YoY)
- Operating Loss (EBITDA): -₹865 crore
- Cash Reserves: Fell by ₹1,488 crore to ₹6,695 crore
Below are the Quarterly Financials of Swiggy
While the company continues to post impressive topline growth, the bottom line tells a worrying story. Losses have nearly doubled YoY, with major burn attributed to Instamart, Swiggy’s quick commerce vertical.
Instamart: High Growth, Higher Burn
Swiggy’s quick commerce business, Instamart, saw its Gross Order Value (GOV) double to ₹4,670 crore, contributing 29% to the company’s total GOV. However, its contribution margin declined from -1.9% in Q3 to -5.6% in Q4.
Swiggy has now delayed its breakeven target for Instamart by three to five quarters—an indication that the road to profitability will be longer than expected.
Competitive Pressures:
- Zomato’s Blinkit is growing faster and is already profitable at the operating level.
- New entrants like Zepto, Flipkart Minutes, BB Now, and Amazon Tez have increased competition and discounting pressure.
- Swiggy added 498 dark stores in FY25, pushing up costs further.
Market Outlook: Room for Growth, But Not Without Risks
India’s food delivery and quick commerce markets are poised for massive growth over the next decade:
Food Delivery:
- 2024 Market Size: $43.5 billion
- 2033 Projection: $265 billion
- CAGR: ~22%
Quick Commerce:
- Expected to grow over 40% annually.
- Online grocery market share is expected to rise from 10% to 45% by 2025.
However, the path to capturing this growth will require deep pockets, disciplined execution, and most importantly, investor patience.
Analyst Views: Mixed Bag with Diverging Targets
The lock-in expiry and weak Q4 performance have led to a sharp divergence in analyst opinions. Target prices now range widely from ₹340 to ₹740—a reflection of the deep uncertainty surrounding Swiggy’s business model.
Recent Analyst Calls:
- JM Financial: ‘Buy’ rating, target cut from ₹500 to ₹450. Cautions against near-term volatility.
- ICICI Securities: Bullish with a ₹740 target, believes Swiggy will benefit from long-term consumption trends.
- HSBC: Downgraded target to ₹350, prefers Zomato due to Swiggy’s elevated cash burn.
- Motilal Oswal: Neutral, values Swiggy at ₹340.
- Jefferies: Target lowered to ₹380; concerned over negative EBITDA and delayed breakeven.
- Anand Rathi: Target of ₹400; shifted profitability projection to FY28 (from FY27).
- Nuvama: Notes Blinkit’s faster growth; Swiggy will need to play catch-up in quick commerce.
Swiggy’s Strategy: Long-Term Vision vs. Short-Term Pain
Despite near-term headwinds, Swiggy is doubling down on its “unparalleled convenience” promise. Its leadership believes the battle will be won by the player who captures user loyalty, not just current profits.
Strategic Moves:
- Expanding dark store footprint aggressively.
- Increasing product variety (SKUs from 6,000 to 20,000+).
- Continuing investment in tech and delivery optimization.
- Accepting deeper near-term losses for higher future market share.
However, the challenge remains: public market investors demand timelines and profitability, not just vision.
Conclusion: Inflexion Point for Swiggy’s Public Market Journey
Swiggy’s stock crash post lock-in expiry marks a pivotal moment in its public market journey. The sell-off wasn’t just about excess supply—it reflected underlying concerns around the company’s ability to scale responsibly, stem its losses, and compete effectively in both food delivery and quick commerce.
While the long-term opportunity remains attractive, Swiggy will need to:
- Sharpen its focus on cost control.
- Show meaningful progress toward breakeven.
- Rebuild investor trust by delivering on promises.
Until then, volatility is likely to continue, and only high-conviction, long-term investors may have the stomach to stay onboard.