Why Did Swiggy's Shares Plunge 41% and Fall Below IPO Price?
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Synopsis
Swiggy’s stock has dropped sharply, losing 41% of its value in 2025 and trading below its IPO price since February. This decline raises questions about the company’s future as it grapples with rising competition and mounting losses. What does this mean for investors and the food delivery industry?
Key Takeaways
- Swiggy's stock has dropped 41% in 2025.
- Reported net loss of Rs 1,081 crore in Q4 FY25.
- Annual losses increased to Rs 3,116 crore.
- Revenue rose to Rs 5,609 crore in the March quarter.
- Quick commerce segment continues to impact profitability.
Mumbai, May 29 (NationPress) Swiggy's shares have experienced a drastic decline in 2025, plummeting by 41 percent thus far this year and trading below its IPO price since February 6.
The decline signals growing investor unease regarding escalating losses, intensifying competition, and uncertainty surrounding the company’s journey towards profitability.
For the January-March quarter (Q4) of FY25, Swiggy disclosed a net loss of Rs 1,081 crore, a marked increase from Rs 799 crore in the same period last fiscal.
This increase in quarterly losses occurred despite a rise in order volumes and revenue, as significant investments in its quick commerce sector continue to impact overall performance negatively.
The company’s annual losses also soared, reaching Rs 3,116 crore in FY25, up 35 percent from Rs 2,350 crore in FY24, according to its latest regulatory filings.
Adjusted EBITDA loss for the March quarter was Rs 732 crore, driven largely by aggressive expansion spending in Swiggy’s quick commerce operations, particularly through Instamart.
Although Swiggy’s revenue climbed to Rs 5,609 crore in the March quarter from Rs 3,668 crore a year prior, analysts remain wary of the company’s capabilities in managing cash burn and achieving profitability.
Rivals such as Zomato, via its Blinkit division, have bolstered their presence in the quick commerce arena, exerting further pressure on Swiggy’s profit margins.
Swiggy CEO Sriharsha Majety defended the company’s performance, referring to FY25 as a “year of many firsts,” emphasizing the launch of new applications like Instamart, Snacc, and Pyng.
He remarked, “Our food delivery engine achieved unprecedented results in terms of innovation and execution, fostering category-leading growth and increasing profitability simultaneously.”
He also highlighted that the out-of-home consumption business became profitable in Q4.
Despite these encouraging developments, the market remains doubtful. Swiggy has yet to regain traction post-IPO and has spent nearly four months trading below its launch price.
Brokerages observe that while the core food delivery segment remains stable, the quick commerce division, despite its rapid growth, continues to hinder profitability.
Point of View
It is clear that Swiggy is navigating a challenging landscape with rising losses and competitive pressure. While the company has made strides in innovation, the market's skepticism reflects broader concerns about sustainability and profitability in the fast-evolving food delivery sector. Our commitment remains to provide balanced coverage that highlights both the achievements and challenges faced by companies like Swiggy.
NationPress
21/07/2025
Frequently Asked Questions
Why did Swiggy's shares fall?
Swiggy's shares fell due to increasing losses, heightened competition, and uncertainty regarding its path to profitability.
What was Swiggy's net loss in Q4 FY25?
In Q4 FY25, Swiggy reported a net loss of Rs 1,081 crore, up from Rs 799 crore in the previous year.
How does Swiggy's performance compare to its competitors?
While Swiggy's core food delivery segment remains stable, competitors like Zomato are increasing pressure in the quick commerce market.
What are the recent developments at Swiggy?
Swiggy launched new apps like Instamart and Snacc and reported profitability in its out-of-home consumption business in Q4.
Is there hope for Swiggy's future profitability?
Despite promising innovations, analysts are cautious about Swiggy's ability to manage cash burn and achieve consistent profitability.
