Swiggy Expands into FMCG Retail with LYNK Logistics Acquisition

Swiggy, the online food delivery company, has announced its acquisition of LYNK Logistics Ltd, a tech-led FMCG retail distribution company, signaling its entry into the food and grocery retail market. The financial details of the deal have not been disclosed. Avendus Capital acted as the sole financial advisor to LYNK and its shareholders during the transaction.

Following the acquisition, LYNK will continue to operate independently, led by its co-founder and CEO, Shekhar Bhende. Established in 2015 by Abinav Raja and Shekhar Bhende, LYNK aids FMCG brands in expanding their retail presence through a network of over 100,000 stores across India's top eight cities. The company has achieved over two times year-on-year growth with improved profitability.

LYNK leverages an integrated technology platform to enhance the retail distribution value chain, encompassing warehousing, inventory management, and logistics operations. It acts as an authorized distributor for leading FMCG brands, connecting them to retail stores and offering a comprehensive solution to achieve sales and growth targets. LYNK also improves order-to-delivery turnaround time and on-the-shelf availability, enabling retail stores to increase sales and enhance customer service.

The Indian retail market, one of the world's largest and fastest-growing, is estimated to exceed $570 billion and is expected to grow at 8% year-on-year. With the acquisition, LYNK will leverage Swiggy's technological and logistical strengths to rapidly scale its existing platform.

Sriharsha Majety, CEO of Swiggy, emphasized LYNK's brand-first, tech-led operating model and its success with multiple FMCG brands in the retail distribution space. Swiggy's expertise in supply chain and logistics presents a unique opportunity to assist LYNK in expanding its offerings and empowering retailers to better serve their customers.

Swiggy has been actively pursuing acquisitions to leverage growth opportunities and strengthen its ecosystem. Previous acquisitions include Dineout, an online restaurant booking app, as well as Kint and Scootsy, among others. The company aims to achieve profitability in its quick-commerce division and drive value unlocking through strategic mergers and acquisitions.

The acquisition of LYNK aligns with Swiggy's focus on digitizing retail distribution in India. LYNK's co-founder, Shekhar Bhende, expressed confidence in Swiggy's support to accelerate growth and capitalize on the vast opportunities in the market.

Avendus Capital's Varun Gupta highlighted the strategic value and growth potential that such synergistic M&A transactions can offer tech companies.