Profitability is the new test
Investors are marking down quick‑commerce players that chased growth with heavy subsidies, so profitability — not just topline GMV — is becoming the decisive metric. Commentary points to Blinkit’s early course correction versus Swiggy Instamart’s troubled economics and a JM Financial downgrade as evidence that undisciplined convenience spending can destroy shareholder value. (laffaz.com) (financialexpress.com)
A grocery app can show huge sales and still be a bad business if every extra order needs a coupon, a discount, and a new warehouse to make it happen. That is the problem now hanging over India’s quick-commerce race. (financialexpress.com) The sharpest signal came on April 9, 2026, when JM Financial cut Swiggy to “Reduce,” slashed its target price to 270 rupees from 370 rupees, and said Instamart under its current strategy would “destroy value” for shareholders. (financialexpress.com) JM Financial’s complaint was not that Instamart is growing too slowly in absolute terms. It was that Swiggy is trying to reach contribution-margin breakeven by the first quarter of fiscal year 2027 while giving up the scale that a delivery network needs to stay relevant. (financialexpress.com) Quick commerce works like a neighborhood convenience store attached to a dispatch room. The more orders each dark store handles in a tight radius, the more fixed costs like rent, riders, and picking staff get spread out. (swiggy.com) That is why investors have stopped treating gross merchandise value like a magic number. Gross merchandise value counts everything sold through the app, but it does not tell you how much cash the company burned to get those orders. (moneycontrol.com) Swiggy’s own numbers showed the tension in plain sight in the quarter ended March 31, 2025. Instamart gross order value doubled year over year to 4,670 crore rupees, but Swiggy’s consolidated adjusted earnings before interest, tax, depreciation and amortisation loss widened to 732 crore rupees as it poured money into quick commerce. (swiggy.com) Swiggy added 316 dark stores in that one quarter, took Instamart to 124 cities, and pushed monthly transacting users to 9.8 million. Those are expansion numbers, but expansion bought with heavy spending is exactly what public-market investors are now questioning. (swiggy.com) Blinkit is not being treated as perfect. In the March 2025 quarter, Blinkit’s adjusted earnings before interest, tax, depreciation and amortisation loss widened from 103 crore rupees to 178 crore rupees after Eternal added 294 net new stores, its biggest quarterly store addition ever. (b.zmtcdn.com) But Blinkit reached this phase from a different starting point. Eternal had already shown Blinkit brushing up against break-even in earlier periods, and fiscal year 2025 ended with Blinkit revenue at 5,206 crore rupees and adjusted earnings before interest, tax, depreciation and amortisation loss at 292 crore rupees, far below Instamart’s 2,095 crore rupee adjusted loss. (moneycontrol.com) Zepto shows why this debate is spreading beyond one listed stock. Its fiscal year 2025 sales jumped 129 percent to 9,668.8 crore rupees, but net loss jumped even faster, up 177 percent to 3,367.3 crore rupees. (moneycontrol.com) Once losses rise faster than sales, investors stop rewarding speed for its own sake. A ten-minute delivery promise starts to look less like a technology edge and more like an expensive habit unless each store, each basket, and each customer cohort gets profitable fast enough. (financialexpress.com)
