India's e-commerce stocks Swiggy and Eternal outrun Chinese peers on profit hopes
e-commerce stocks
have outpaced local indexes and regional peers over the past month, as a rapid rebound fuels bets on their ability to edge out rivals and boost profitability.
Shares of
Swiggy
Ltd. climbed 20% last month, topping the NSE Nifty 100 Index, while
Eternal Ltd.
advanced 11%. The rally in India's fast-growing
quick-commerce
sector — which delivers daily essentials in just minutes — contrasts sharply with losses for counterparts in China, where a fierce price war has battered food-delivery firms.
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
Play War Thunder now for free
War Thunder
Play Now
Undo
Even with new entrants including Amazon.com Inc. and Walmart Inc.'s Flipkart India Pvt., analysts say incumbents Swiggy, Eternal, and unlisted Zepto are likely to retain market share, thanks to their entrenched supplier networks and first-mover advantage.
'Established players have shown they can manage delivery costs effectively, especially in paying and utilizing riders efficiently,' said Nirav Karkera, a fund manager and head of research at Fisdom. 'New entrants, however, will still need to prove they can do this in a sustainable way,' he added.
Quick commerce is reshaping India's online retail landscape, with companies racing to tap into a market that Bloomberg Intelligence estimates could reach $100 billion by 2030. The segment promises delivery of essentials like groceries of personal care items in as little as 10 minutes.
Live Events
Bloomberg
For now, Eternal's Blinkit, Swiggy's Instamart and Zepto collectively control around 88% of the quick-commerce market share in India, according to data compiled by
JM Financial Ltd.
Blinkit has led the segment since its 2022 acquisition by Eternal, which also owns food-delivery platform
Zomato
.
These established businesses have invested heavily in expanding their warehouse and 'dark store' fulfillment-center networks to more and more cities. That's put pressure on profit margins along with price cuts intended to lure customers.
Such costly expansion is expected to ease for the early movers this year, however, allowing them to focus on profitability while newer entrants still need to invest in order to gain share. Major players are also moving toward better monetization by incentivizing high-value purchases and charging fees for new related services.
E-commerce platforms are raising average order sizes, applying more discipline to their discounts and increasingly focusing on improving their economics, JM Financial analysts including Swapnil Potdukhe wrote in a June 26 note. 'Losses may have already peaked' for both
Blinkit
and Instamart, they added.
In China meanwhile, the e-commerce delivery sector continues to struggle with hostile competition. The leaders Meituan and JD.com Inc. have shed more than $70 billion in combined market value since March peaks.
Bloomberg
Challenges also remain in India. Inroads by Zepto have taken the most market share from Instamart, according to JM Financial's data. And
Swiggy
is still unprofitable, though analyst sentiment has been improving, with its ratio of analyst buy recommendations climbing to the highest since its late 2024 listing.
Plans for an eventual stock market
listing
by Zepto may draw some investment allocations away from Eternal and Swiggy, according to Fisdom's Karkera. Nevertheless, they're all seen benefiting from expansion of a market that is still growing.
'The incumbents continue to stretch their lead in users as well as in store networks, despite lowering discounts and levying delivery and handling fees,' said Aditya Soman, an analyst at CLSA Ltd. 'We remain positive on the quick-commerce opportunity. We believe there is enough room for the incumbents and a couple of new entrants.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
3 hours ago
- Time of India
Delta's AI fare strategy: Cheaper flights or high-tech price hikes?
Delta Air Lines is changing how ticket prices are decided by letting artificial intelligence take the wheel. In a bold move, the airline is using AI to help determine airfare on some U.S. domestic routes. While only about 3 per cent of flights are currently covered, Delta plans to expand this AI pricing system to 20 per cent by the end of 2025. This new approach replaces traditional fare setting methods with real time pricing decisions, based on data like travel demand, competitor prices, and booking trends. Delta says the system developed by Israeli tech firm Fetcherr is already boosting revenue and efficiency. How it works: AI-powered dynamic pricing Delta's AI system, developed by Israeli startup Fetcherr, analyzes a wide range of data in real time such as demand trends, market fluctuations, booking pace, and competitor pricing. Rather than using static fare charts, the AI suggests optimal prices that can adapt instantly to changing conditions. Productivity Tool Zero to Hero in Microsoft Excel: Complete Excel guide By Metla Sudha Sekhar View Program Finance Introduction to Technical Analysis & Candlestick Theory By Dinesh Nagpal View Program Finance Financial Literacy i e Lets Crack the Billionaire Code By CA Rahul Gupta View Program Digital Marketing Digital Marketing Masterclass by Neil Patel By Neil Patel View Program Finance Technical Analysis Demystified- A Complete Guide to Trading By Kunal Patel View Program Productivity Tool Excel Essentials to Expert: Your Complete Guide By Study at home View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program Delta President Glen Hauenstein called it a 'reengineering' of pricing science and noted early trials have led to 'amazingly favorable unit revenues,' a metric used to gauge profitability per seat. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play War Thunder now for free War Thunder Play Now Undo Concerns over fairness and transparency Despite Delta's optimism, the move has sparked concern among lawmakers and consumer advocates. Senators Mark Warner, Richard Blumenthal, and Ruben Gallego sent a letter to the airline questioning whether AI driven fare decisions could lead to " surveillance pricing ." Their concern: that AI might use personal data to charge individuals based on their perceived willingness to pay. Delta responds: No personal data used Delta has firmly denied using personal information to set prices. In a statement, the airline clarified that it does not use browsing history, financial details, or customer profiles. Instead, pricing is based on anonymized market data and traditional travel factors like origin, destination, date, seat class, and refundability. 'All customers have access to the same fares,' a Delta spokesperson emphasized. Live Events A broader trend in air travel? Industry analysts suggest this is just the beginning. As airlines compete for profitability in a volatile market, many are likely to adopt AI tools to gain an edge. While dynamic pricing isn't new, the speed and granularity offered by AI raises concerns about fairness and transparency. Consumer rights groups are keeping a close eye on the issue. A new bill in Congress, called the Stop AI Price Gouging and Wage Fixing Act, seeks to ban the use of consumer profiling in pricing and could impact how AI tools like these are used in the future. FAQs Q1. What is Delta's AI pricing system? A1. Delta is using artificial intelligence to set ticket prices based on real-time market data. The system is designed to optimize fares depending on demand, competition, and booking trends. Q2. How could AI-based pricing affect travelers? A2. Travelers may see more frequent changes in fares based on demand and timing. It might get harder to know when you're getting the best deal.
Time of India
4 hours ago
- Time of India
RBI tweaks procedure for opening special rupee vostro accounts
The RBI on Tuesday tweaked norms and allowed banks to open Special Rupee Vostro Accounts (SRVAs) of correspondent banks without its prior approval. In July 2022, the Reserve Bank of India (RBI) had put in place an additional arrangement for invoicing, payment, and settlement of exports/ imports in Indian rupee. Productivity Tool Zero to Hero in Microsoft Excel: Complete Excel guide By Metla Sudha Sekhar View Program Finance Introduction to Technical Analysis & Candlestick Theory By Dinesh Nagpal View Program Finance Financial Literacy i e Lets Crack the Billionaire Code By CA Rahul Gupta View Program Digital Marketing Digital Marketing Masterclass by Neil Patel By Neil Patel View Program Finance Technical Analysis Demystified- A Complete Guide to Trading By Kunal Patel View Program Productivity Tool Excel Essentials to Expert: Your Complete Guide By Study at home View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program Under the arrangement, banks were permitted to open SRVAs of correspondent banks, with the prior approval of the Reserve Bank for settling cross-border trade transactions . by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like War Thunder - Register now for free and play against over 75 Million real Players War Thunder Play Now Undo "Based on a review of the procedure involved in opening of the SRVA, it has been decided to do away with the need for seeking RBI approval for opening of SRVA," the RBI said in a statement. Banks can now open SRVAs of correspondent banks without referring to the Reserve Bank of India. Live Events The change in procedure will considerably quicken the process for opening of SRVAs, the RBI said.
Time of India
6 hours ago
- Time of India
India's business confidence index rises to 149.4 in April-June: NCAER
The Business Confidence Index (BCI) rose sharply to 149.4 in the April-June period from 139.3 in the last quarter of 2024-25, according to the Business Expectations Survey of National Council of Applied Economic Research ( NCAER ). NCAER in a statement said the BCI is based on four components -- overall economic conditions to improve in next six months, financial position of firms will improve in the next six months, present investment climate and whether present capacity utilisation was close to or above optimal level. Productivity Tool Zero to Hero in Microsoft Excel: Complete Excel guide By Metla Sudha Sekhar View Program Finance Introduction to Technical Analysis & Candlestick Theory By Dinesh Nagpal View Program Finance Financial Literacy i e Lets Crack the Billionaire Code By CA Rahul Gupta View Program Digital Marketing Digital Marketing Masterclass by Neil Patel By Neil Patel View Program Finance Technical Analysis Demystified- A Complete Guide to Trading By Kunal Patel View Program Productivity Tool Excel Essentials to Expert: Your Complete Guide By Study at home View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program The share of positive responses across the four components remains above 60 per cent in the first quarter and also each component exhibited improving trend compared to the preceding quarter, the statement added. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play War Thunder now for free War Thunder Play Now Undo Majority of respondents expected production (78.7 per cent) and domestic sales (79.1 per cent) to increase in the next six months. The statement said sentiments about export of final products also improved (66.5 per cent) in the first quarter of the current fiscal year. Live Events Percentage of firms expecting import of raw materials to rise also increased (54.3 per cent) from the preceding quarter (46.1 per cent), signalling a push in domestic production activities, it added. Regarding sentiments about pre-tax profits, nearly 61 per cent of firms expected them to rise, indicating continued buoyancy. However, the statement said buoyancy in business sentiments was not reflected in the labour markets that showed signs of stagnation with both sentiments about hiring and expectations of wage rates remaining unchanged over the next six months. NCAER's Professor Bornali Bhandari, who led the survey, said, "With moderation in costs, firms were more optimistic about the next six months." The quarterly survey was carried out in June, covering 479 companies spread across six cities, the statement added.
