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The latest GST changes suggests that Eternal and Swiggy will have to pay 18% GST on delivery charges collected from customers. We believe that the impact (if any) will be negligible for both because 1) in food delivery, delivery charges typically get waived on twothirds of their order volumes and 2) in quick commerce, Blinkit already collects 18% GST on delivery charges, whereas Instamart ends up waiving the charges on most orders. Importantly, platforms have historically passed on the GST burden to end customers across various fee types, suggesting that any incremental incidence this time around will likely be a pass-through. Separately, our recent checks suggest that both companies have raised platform fees (including GST of 18%) in their respective food delivery businesses to ~INR 15.0 and INR 14.75 per order from INR 12.0 and INR 11.8, respectively. These changes seem to have been undertaken to offset the negative impact of lowering of minimum order value (MOV) on certain orders, effective Aug’25. For example, subscription consumers on both platforms are currently getting delivery charge waivers on any order above INR 99 despite the fact that officially the MOV for free delivery stands at INR 199 (on all orders up to 7km). This, in turn, makes us believe that the platform fee hikes would have limited pass-through benefit at Adj. EBITDA level for both.

• GST release suggests hyper local delivery platforms will have to pay 18% GST on delivery fees: We believe the change will have negligible impact (if any) for either Eternal and Swiggy because 1) in food delivery, delivery charges typically get waived on two-thirds of the two companies’ order volumes either due to subscription programme benefit or order value crossing MOV threshold and 2) in quick commerce, Blinkit already collects 18% GST on all orders where it collects delivery charge from customers, whereas Instamart ends up waiving the charges on most orders. Importantly, these platforms have historically passed on any GST burden to consumers on similar types of fees such as platform fees, convenience fees, handling fees and/or small cart fees. This makes us believe that any incremental incidence this time around will likely be a pass-through to consumers.
• Channel checks suggest both food-techs have recently raised platform fees: Swiggy has raised its platform fee in its food delivery business to ~INR 15 per order (including GST), making it the third hike in 3 weeks. The fee was earlier revised from INR 12 to INR 13 and subsequently to INR 14 before reaching the current level. Similarly, Eternal-owned Zomato has raised its platform fees from INR 11.8 earlier to INR 14.75 (including GST).
• Platform fee changes likely taken to offset negative impact of lower MOV: Our checks suggest that both food-techs had recently lowered their MOV on subscription-based orders to INR 99 from INR 199 earlier, likely to boost order volumes at a time when macros have been challenging. In fact, this development is in sharp contrast to their earlier efforts to move up the MOV in order to support unit economics. This is likely because lower MOV adversely impacts the revenue per order as well as lowers delivery charges collected from customers. We therefore believe the primary motive behind these recent platform fee hikes is to offset that impact. Moreover, with demand broadly remaining inelastic to platform fee increases till now, both food-techs likely feel emboldened to undertake such hikes, part of which also helps support their Adj. EBITDA margin.
• Platform fee hikes may not completely flow down to Adj. EBITDA: We project Zomato and Swiggy to deliver ~1,100mn and ~800mn food delivery orders in FY27 respectively. Ceteris paribus, the entire platform fee increase (excluding GST) would have flown down to Adj. EBITDA, leading to an incremental uptick of ~INR 2.7bn/2.0bn for Zomato and Swiggy, respectively. However, given that MOV has also been lowered, the flow-down benefit to Adj. EBITDA will be relatively lesser, in our opinion.

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