Zomato vs Swiggy: Macquarie Report Compares Food Delivery and Quick Commerce Businesses Ahead of Swiggy IPO

As Swiggy prepares for its initial public offering (IPO) in November 2024, global brokerage Macquarie has compared Swiggy and its close rival, Zomato, in the food delivery and quick commerce sectors. According to Macquarie, Swiggy is 4-6 quarters behind Zomato in both these verticals.

The report, titled Head-to-Head: Zomato vs Swiggy, highlights that while Swiggy can catch up more easily in food delivery, its quick commerce business faces more challenges. Swiggy is aiming to raise up to ₹3,750 crore through fresh share issues and an offer for sale (OFS) of up to 185.28 million shares.

Also Read: Swiggy Files Updated IPO Papers, Seeks Rs 3,750 Crore

Quick Commerce: Blinkit vs Instamart

Macquarie's analysis shows Zomato’s quick commerce arm, Blinkit, is ahead of Swiggy’s Instamart in several key areas, including monthly transacting users (MTU), average order value (AOV), and efficiency (based on dark store throughput).

• Blinkit’s MTUs grew to 7.6 million by the end of Q1 FY25, compared to Instamart’s 5.2 million.
• Blinkit is expected to close FY25 with 400 million orders, growing at a CAGR of 40% between FY24-28, while Instamart is projected to finish FY25 with just over 200 million orders.
• Blinkit’s AOV is about 25% higher than Instamart’s, mainly due to a higher share of non-grocery orders from Delhi NCR.
• Blinkit's gross order value (GOV) for FY25 is estimated at $3 billion, compared to Instamart’s $1 billion.
• Blinkit has a positive contribution margin of ₹25 per order (4%), while Instamart’s margin was negative at -15% in Q1 FY25.

Also Read: Swiggy Awards $271 Million in ESOPs to Top Executives Ahead of IPO

For Instamart to break even, its AOV would need to improve to ₹600 per order, along with higher take rates and customer fees.

Food Delivery: Zomato vs Swiggy

In food delivery, Zomato also leads Swiggy.

• Zomato had 20.3 million MTUs at the end of Q1 FY25, compared to Swiggy's 14 million.
• Zomato’s total orders reached 218 million in Q1 FY25, while Swiggy had 156 million.
• Zomato's AOV stood at ₹425 per order, slightly lower than Swiggy’s ₹436 per order.
• Zomato’s GOV for Q1 FY25 was $1,116 million, while Swiggy's was $820 million.
• Zomato’s food delivery revenue was $234 million, compared to Swiggy’s $183 million.

Zomato also reported a higher adjusted EBITDA margin of 3%, compared to Swiggy's 1%. Macquarie predicts that Swiggy could reach a 4-5% adjusted EBITDA margin by cutting delivery costs.

Also Read: Swiggy Blocks Zomato CEO Deepinder Goyal from Returning to Shark Tank India as Season 4 Sponsor Deal Nears Completion

Overall, Zomato’s GOV for FY25 is estimated to be $4.8 billion, with a projected CAGR of 16% from FY24-28. Swiggy is trailing by about 25%, or roughly six quarters, in GOV growth.