Company Update : Swiggy by Motilal Oswal Financial Services Ltd
Investor Day 2026: Innovation remains intact; all eyes on execution
We attended Swiggy's Investor Day, where discussions were centered on four key areas:
1) How Swiggy aims to differentiate Instamart in an increasingly competitive quick commerce market
2) expanding the Food Delivery opportunity through Toing
3) scaling the Out-of-Home (Dineout) business
4) the company's medium-term profitability framework. Swiggy outlined an ambitious target of ~INR100b adjusted EBITDA by FY31, comprising ~INR50b from Food Delivery, ~INR40b from Quick Commerce, and ~INR10b from Out-of-Home (refer to Exhibit 3). If achieved, this would represent a meaningful upside to our current estimate of INR55b. We currently do not model the management guidance into our estimate (refer to Exhibit 1). That said, the current valuation provides an enticing opportunity to play this possibility, subject to execution
The broader takeaway, in our view, is that Swiggy continues to innovate, but the next leg of stock performance is likely to depend on execution rather than product launches. Whether it is Toing, Switch, Noise, or Nectr, the innovation pipeline remains active. However, delivering the INR100b profitability aspiration will require sustained improvement in Instamart MTU additions, ordering frequency, advertising monetization, and dark-store productivity over the next few quarters. We continue to value Swiggy on an SOTP basis and reiterate our BUY rating with a TP of INR350
Innovation pipeline remains active; all eyes on execution
* Swiggy continues to innovate across businesses. Whether it is Toing in Food Delivery, Switch as a discovery layer, or Noise and Nectr as private brands, the company's willingness to build new products remains intact.
* We believe the debate is gradually shifting from innovation to execution. Most of the strategic building blocks are now visible; the next phase depends on scaling them while improving profitability.
* For Instamart, the key monitorables remain relatively straightforward. MTUs have remained broadly flat over the last few quarters, while ordering frequency (~1,089 orders per dark store per day) continues to trail Blinkit's ~1,505 OPD. We believe higher MTU additions, better repeat behavior, and improved dark-store utilization remain the biggest drivers of operating leverage.
Valuation and view
* Swiggy outlined an ambitious target of ~INR100b adjusted EBITDA by FY31. If achieved, this would represent a meaningful upside to our current FY31 adjusted EBITDA estimate of INR55b. We do not currently model the management guidance into our estimates. That said, the current valuation provides an enticing opportunity to play this possibility, subject to execution.
* While Food Delivery continues to execute steadily with a capital-light model and improving profitability, the focus now shifts to whether Instamart can deliver its targeted ~42% GOV CAGR, improve advertising monetization from ~4% to 7-8% of GOV, and translate better store utilization into EBITDA profitability.
* The key monitorables over the next few quarters, in our view, remain MTU additions, ordering frequency, advertising monetization, and dark-store productivity. We value the Food Delivery business at 30x FY28E EV/EBITDA, the Out-of-Home, Platform and Supply Chain businesses at 1x FY28E EV/Sales, and Quick Commerce using a DCF methodology. We reiterate our BUY rating with a revised TP of INR350, implying a 21% upside.
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