Swiggy, one of India’s leading online food delivery platforms, is gearing up to make its debut in the stock market after receiving approval from the Securities and Exchange Board of India (SEBI) for its Rs 12,500 crore IPO. With its competitor Zomato already listed, the IPO marks a significant move for Swiggy as it prepares to challenge Zomato not just in the food delivery space, but also in the stock market.
Deepinder Goyal’s Take on Swiggy’s IPO
Zomato’s founder and CEO, Deepinder Goyal, sees the entry of Swiggy into the stock market as a positive development. When asked about his thoughts during a conversation with Moneycontrol, Goyal shared that the listing of another food tech company is beneficial for the entire industry. According to him, having more companies in the sector creates healthy competition, which can drive innovation and growth.
Interestingly, Goyal mentioned that despite leading Zomato, he has never used any other food delivery app. His focus remains strictly on Zomato, and external factors, including competitors, don’t concern him as much. For Goyal, the priority is always on improving Zomato’s services and offerings, regardless of what others are doing in the market.
Swiggy’s IPO: The Competitive Edge
Swiggy’s co-founder and CEO, Sriharsha Majety, also shared his perspective on the upcoming IPO. While he acknowledged the advantages and disadvantages of having a listed competitor like Zomato, Majety pointed out that being in the public market brings visibility and clarity to the sector. It also means that companies will be scrutinized and compared quarterly, which can be a challenge.
However, Majety also emphasized the benefits of listing. He mentioned that quarterly financial reviews compel companies to stay focused and deliver consistently. While this might make long-term planning more difficult, it forces businesses to remain agile and responsive to market demands. For Swiggy, this IPO is not just about raising funds, but also about setting a long-term growth strategy.
The Growing Gap Between Zomato and Swiggy
The rivalry between Zomato and Swiggy has been fierce for years, with both companies competing head-to-head in the food delivery market. A few years ago, they were neck and neck, but Zomato has pulled ahead in recent years. Zomato now holds a stronger position in both the food delivery and quick commerce segments, widening the gap between the two companies.
An interesting development was Swiggy’s recent sponsorship of the popular reality show “Shark Tank India” for Rs 25 crore. As part of the deal, Zomato’s CEO, Deepinder Goyal, had to step down from his role as a Shark investor, which helped Swiggy gain visibility and reduce its marketing expenses. This branding move has certainly helped Swiggy, but the financial gap between the two companies remains significant.
Financial Health of Zomato and Swiggy
From a financial perspective, Zomato has been steadily improving its performance since its stock market debut. The company has successfully reduced its losses year after year and is now reporting profits. In FY 2024, Zomato posted a revenue of Rs 12,114 crore and a profit of Rs 351 crore. In comparison, Swiggy’s revenue for the same period was Rs 8,265 crore, with a loss of Rs 2,350 crore. Despite the loss, Swiggy has managed to reduce its deficit by 44%.
In the June quarter of FY 2025, Zomato’s revenue surged by 74% year-on-year, reaching Rs 4,206 crore. It also reported a profit of Rs 253 crore for the quarter. Swiggy, on the other hand, posted a revenue of Rs 3,222.2 crore, an increase of 35% year-on-year, but its losses also grew by 8%, amounting to Rs 611 crore.
As Swiggy prepares for its IPO, the competition between the two giants is set to intensify. While Zomato currently holds a lead in terms of financial performance and market share, Swiggy’s entry into the stock market could shift the dynamics in the industry, giving both companies a new platform to compete on.
Swiggy’s IPO will likely attract significant interest from investors, but whether it can close the gap with Zomato in both the food delivery and stock market spaces remains to be seen.
