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Brokerages’ ‘Buy’ ratings on Swiggy’s IPO amid capitalization loss concerns

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Ashutosh Dubey
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Brokerages' 'Buy' ratings on Swiggy's IPO amid capitalization loss concerns

UBS, a global brokerage firm, has started covering Swiggy, a major food delivery platform company, and given it a ‘Buy’ rating. They have set a target price of INR 515 for the next 12 months.

UBS set target price of INR 515, 19% uptick

This represents an over 19% upside from the stock’s last closing price of INR 431.25. UBS believes that there is “plenty of room at the table” and Swiggy is well-positioned to benefit from the rapid growth in India’s food delivery and quick commerce markets.

Continue Exploring: Zomato launches INR 8,500 Cr QIP at floor price of INR 266 per share

Meanwhile, the brokerage firm noted that while Swiggy lost market capitalization in the previous year, data shows signs of market share stabilization. This is visible in the company’s Q1 FY25 results as well. On the quick commerce vertical, UBS said that Swiggy lost market share to peers despite being the pioneer in the segment.

Swiggy Instamart’s order count sees 41% jump

However, the company has made infrastructure changes to adapt to changing trends, including expanding the size of dark stores and densifying the dark store footprint in urban areas. These changes have shown results, with Swiggy Instamart’s order count jumping 41% in Q1 FY25 and average order value increasing by 10%. Despite this, Instamart needs to narrow the gap with Blinkit.

Continue Exploring: Tata Group launches Neu Flash q-commerce delivery amid intensifying competition

Further, UBS expects Swiggy’s quick commerce vertical to achieve adjusted EBITDA breakeven in FY29. The brokerage firm believes that Swiggy’s stock price is at a 35-40% discount to Zomato and sees room for this valuation discount to narrow as the company demonstrates stabilizing market share.

Notably, UBS has become the latest brokerage firm to initiate coverage on Swiggy after its listing earlier this month. Other brokerage firms, including JM Financial and Motilal Oswal, have also initiated coverage on Swiggy with ‘Buy’ and ‘Neutral’ ratings, respectively.

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Flipkart guilty of unfair trade practice! Consumer Commission’s action 

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Ashutosh Dubey
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Flipkart guilty of unfair trade practice! Consumer Commission’s action 

Flipkart, the ecommerce giant, has been held guilty of unfair trade practice by the District Consumer Disputes Redressal Commission in Mumbai.

Flipkart’s “no return policy” results INR 4,641 loss

The commission’s decision came after a consumer complaint about receiving inferior-quality food products from Flipkart, which cited its “no return policy” and refused to replace the items. The consumer had purchased 13 containers of a health drink mix from the e-commerce platform in October 2023 for INR 4,641. However, the products were found to be of abnormal color and texture, lacked a QR code on the label, and were likely fake.

Continue Exploring: Tata Group launches Neu Flash q-commerce delivery amid intensifying competition

Meanwhile, the commission ordered Flipkart and the seller to refund the product’s cost with interest and pay INR 10,000 as compensation to the complainant. This is not the first time Flipkart has faced action for unfair trade practices. In March this year, a consumer disputes redressal commission in Mumbai ordered the company to pay INR 10,000 to a customer for cancelling his iPhone order.

CCI finds Amazon and Flipkart guilty

Reportedly, Flipkart and its rival Amazon were recently found guilty of violating competition laws by the Competition Commission of India. Meanwhile, the Enforcement Directorate (ED) is also investigating the two ecommerce players for violation of foreign direct investment laws. 

Continue Exploring: Tata Consumer foresees continued volume growth, sees food inflation as ‘short-term blip’

On the financial front, Flipkart continues to be a loss-making entity. Flipkart’s marketplace arm, Flipkart Internet, reported a 41% year-on-year decline in its net loss to INR 2,358 Cr in the financial year 2023-24. Operating revenue zoomed 21% to INR 17,907.3 Cr.

Amid all these challenges, Flipkart also launched its quick commerce service earlier this year due to the rising popularity of the segment. The company has been working to enhance its customer experience, with initiatives like same-day delivery services in 20 major Indian cities. 

Further, Flipkart’s parent Walmart reported 8% year-on-year growth in its international sales in Q3 FY25, driven by the ecommerce company’s solid sales growth during its flagship sale, The Big Billion Days.

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Zomato launches INR 8,500 Cr QIP at floor price of INR 266 per share

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Ashutosh Dubey
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Zomato launches INR 8,500 Cr QIP at floor price of INR 266 per share

Zomato, a leading foodtech company, has opened its INR 8,500 Cr qualified institutions placement (QIP) and set a floor price of INR 265.91 per equity share, a discount of 2.8% from its closing price today.

Zomato receives shareholders nod

In an exchange filing, the company said that the fund raising committee of its board approved the opening of the QIP on Monday (November 25). Zomato said that the QIP issue price would be decided in consultation with the book running lead manager and it may offer a discount of not more than 5% on the floor price.

Continue Exploring: Zomato gets shareholders’ approval to secure INR 8,500 Cr via QIP

This development comes about two days after Zomato received approval from its shareholders to raise INR 8,500 Cr (around $1 Bn) through the QIP. The company had disclosed its plans to undertake its first fundraise post listing in October this year. 

In its shareholders’ letter for the second quarter of the fiscal year, founder and CEO Deepinder Goyal said that the capital will enhance Zomato’s cash reserves. 

“We believe that we need to enhance our cash balance given the competitive landscape and the much larger scale of our business today. We believe that capital by itself does not give anyone the right to win, but we want to ensure that we are on a level playing field with our competitors, who continue to raise additional capital,” he said.

Continue Exploring: Tata Consumer foresees continued volume growth, sees food inflation as ‘short-term blip’

Swiggy releases IPO 

Since October, the company’s major competitors, Swiggy in the food delivery and quick commerce segment and Zepto in the 10-minute delivery space, have seen a significant capital infusion. Earlier this month, Swiggy turned into a publicly listed company and raised INR 11327.43 Cr from issuance of fresh shares in its initial public offering (IPO). 

Meanwhile, quick commerce unicorn Zepto raised another $350 Mn last week. With this, it became the most heavily funded startup this year, raising over $1.3 Bn in 2024 alone.

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Tata Group launches Neu Flash q-commerce delivery amid intensifying competition

By
Ashutosh Dubey
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Tata Group launches Neu Flash q-commerce delivery amid intensifying competition

Tata group‘s ecommerce venture, Neu, is piloting a quick commerce delivery service under Neu Flash, as demand for instant deliveries picks up pace in India.

Tata’s Neu Flash now operates in 20 cities

According to the sources, the 15-minute delivery service is now active in more than 20 cities across India, including major metros like Delhi NCR, Mumbai, Bengaluru, Hyderabad, Pune, Chennai, as well as several tier-II cities.

Continue Exploring: Tata Consumer foresees continued volume growth, sees food inflation as ‘short-term blip’

The rollout is currently limited to select pin codes within these cities, with a curated selection of products available during the initial phase. Neu Flash offers delivery of products ranging from groceries and electronics to apparel and beauty items. The app, which is built upon Tata’s existing digital infrastructure, offers quick delivery across multiple categories, including groceries, electronics, apparel, and beauty products.

However, Neu Flash leverages BigBasket‘s existing hyperlocal network for grocery deliveries, while Croma manages electronics deliveries and Tata Cliq handles fashion and lifestyle products. This expansion comes as Tata Digital works to strengthen Neu’s market position, following its earlier challenges in the superapp space.

For now, the quick commerce expansion follows substantial backend improvements to Neu’s platform over the past year, including a revamped user interface and enhanced integration of Tata’s digital assets.

Continue Exploring: abCoffee introduces coconut-based, non-dairy beverages across 75-plus outlets in India

India’s q-commerce sees 280% growth 

Meanwhile, Industry data shows that India’s quick commerce sector has grown by 280% in the last two years, with market leaders Blinkit, Zepto, and Swiggy Instamart collectively reporting over $1 Bn in revenue for FY24. This comes at a time when companies in India are intensifying their quick commerce offerings.

Recently, Myntra has introduced M-Now, offering deliveries in 30 minutes to 2 hours. Amazon India is getting ready to launch its own quick delivery service called Tez. Zepto’s recent $350 million funding, led by Motilal Oswal‘s Private Wealth division, shows how fierce the competition is in the quick commerce market.

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Tata Consumer foresees continued volume growth, sees food inflation as ‘short-term blip’

By
Ashutosh Dubey
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Tata Consumer foresees continued volume growth, sees food inflation as ‘short-term blip’

Tata Consumer Products Ltd (TCPL) is viewing the current food inflation as a “short-term blip” and expects it to moderate in the next two quarters, along with a revival in consumer demand, according to its Managing Director & CEO Sunil D’Souza.

TCPL rules out price hike amid pressure

TCPL, the FMCG arm of the Tata Group, has ruled out any immediate price hike despite margins being under pressure, as it wants to “continue the volume momentum” as part of its growth ambitions.

Continue Exploring: abCoffee introduces coconut-based, non-dairy beverages across 75-plus outlets in India

“We are a growth company, and we will target double-digit top-line growth (revenue) and bottom line (margins) ahead of the top line, accepting for the right short term, which is the next two quarters,” D’Souza stated, as per ET. He also stated that food inflation remains high and in October, it was almost at double-digit, impacting urban consumption to a bit. However, the good news is the vast majority of India lives in the villages and the rural demand has started to come back after being under pressure for some quarters.

“In the short term, probably for a quarter, or maybe two quarters, you would see a pressure on margins. But I do expect momentum on top line and market share to continue,” he said.

FMCG majors experience sluggish growth in urban markets

Recently, several listed FMCG makers in their latest September quarter results reported an impact on their earnings due to high food inflation, which slowed down the pace of urban consumption. “Food inflation is a short-term blip and over the next two quarters, I do see that moderating and when that moderates, we do see demand coming back,” he added.

Continue Exploring: Western Railways announces launch of Mumbai’s first open-air Restaurant on wheels

In segments like tea, in which TCPL is a leading branded player, the company saw an increase of about 25-30 per cent in raw material prices but it did not pass on the price hike to end consumers. “We don’t want a demand shock coming in. So we have to be comparative. We have to make sure the category continues to be chugging along. So we have translated bit by bit, and we will be taking gradual price increases,” he further said. 

According to D’Souza, he is a “firm believer” that margins will come back if structural costs are right, but if you lose on market share, “getting it back is a very expensive and tiring climb back”.

“Structurally, in the last five years, we had a 12 per cent top line, 14 per cent EBITDA growth and close to 20-23 per cent of net profit. We aim to continue that trajectory going forward,” he mentioned. When asked about the price hike, D’souza said besides the tea and salt category, he did not see “any significant increase”. “Pulses (Tata Sampann) did have inflation in the first six months, and there, we calibrated the prices very quickly,” he said, adding that “gradual price increases in tea and salt have already taken it and the balance would be minimal”.

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Health Minister Rane announces revamped hygiene rating for Goa’s eateries

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Ashutosh Dubey
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Health Minister Rane announces revamped hygiene rating for Goa's eateries

Goa’s restaurant industry is set for a major overhaul as the Food and Drugs Administration (FDA) gears up to conduct hygiene inspections across the state.

FDA to ensure hygiene standards for Restaurants

This move comes after the FDA received multiple complaints about unsanitary conditions in several restaurants, particularly in the coastal belt. As per ET, Health Minister Vishwajit Rane stated that the FDA will be conducting these inspections to ensure that restaurants adhere to proper hygiene standards.

Continue Exploring: Western Railways announces launch of Mumbai’s first open-air Restaurant on wheels

An FDA official revealed that they receive around 10-12 complaints every month about unhygienic restaurants from both locals and tourists. “We then inspect the premises and issue necessary directions to the food business operator to improve hygiene,” the official said. To conduct these inspections, the FDA will be roping in FSSAI-empanelled third-party auditors. 

Health Minister Vishwajit Rane further said, “These comprehensive audits will evaluate adherence to FSSAI food safety standards, maintenance of proper sanitation protocols, staff hygiene training practices, and waste management systems.”

Non-compliant Restaurant owners may face action

Meanwhile, Restaurant owners are expected to comply fully with these requirements, as non-compliance may result in strict action under Food Safety and Standards Regulation. Furthermore, every restaurant is required to obtain and display an official hygiene rating certificate on their premises. This hygiene rating system was initiated by FSSAI to ensure that consumers make informed choices while eating out and to encourage food businesses to improve their food hygiene standards.

Continue Exploring: Goyal Salt ltd registers approx. 60% revenue growth, hits INR 74.82 Cr in H1FY25 

“The primary objective of this initiative is to enhance food safety standards and restore public confidence in Goa’s restaurant industry,” concluded Health Minister Rane. The FDA official also mentioned that hygiene rating was launched in Goa a year ago but received a poor response from food business owners, prompting them to consider re-launching the initiative.

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abCoffee introduces coconut-based, non-dairy beverages across 75-plus outlets in India

By
Ashutosh Dubey
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abCoffee introduces coconut-based, non-dairy beverages across 75-plus outlets in India

abCoffee, a prominent grab-and-go coffee chain in India, has launched the country’s first-ever range of 13 coconut-based, non-dairy beverages.

abCoffee to cater demand for plant-based products with launch

This innovation caters to the growing demand for plant-based alternatives, offering both coffee and non-coffee options tailored for modern consumers. The new range, introduced in three phases, debuted in Mumbai and received significant positive feedback, prompting abCoffee to expand the offerings nationwide.

Continue Exploring: Swiggy ropes in Flipkart’s DoS Kanika Tiwari as Head of Monetization

Now available across more than 75 retail outlets in India, the lineup combines coconut milk’s creamy texture with abCoffee’s specialty coffee blends, catering to those seeking dairy-free, health-conscious options. 

Our mission at abCoffee has been to innovate – VP abCoffee

Narsaya Gajji, Vice President of Operations at abCoffee said, “Our mission at abCoffee has always been to innovate and make specialty coffee accessible, affordable, and inclusive for everyone. The coffee range which got coffee beverages wide appeal across several parts of Asia, resulting in countries like China, Indonesia, Philippines fall in love with coffee is now available in India. I personally love the Iced Thai Latte and Bubble-gum swirl, absolutely amazing.”

Continue Exploring: Goyal Salt ltd registers approx. 60% revenue growth, hits INR 74.82 Cr in H1FY25

The coconut-based range includes unique options such as the Iced Coconut Thai Latte, Bubble Gum Coconut Swirl, and Vanilla Coconut Latte. These beverages are made using specialty coffee beans sourced from India’s plantations, paired with coconut milk to create low-calorie, plant-powered drinks that appeal to coffee enthusiasts and non-coffee drinkers alike. 

This launch aligns with abCoffee’s commitment to bringing accessible and inclusive coffee experiences to the Indian retail sector while contributing to the evolving coffee culture in the country.

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Western Railways announces launch of Mumbai’s first open-air Restaurant on wheels

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Ashutosh Dubey
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Western Railways announces launch of Mumbai's first open-air Restaurant on wheels

Western Railway (WR) authorities are set to introduce Mumbai’s first open-air restaurant on wheels, which promises to transform the station’s premises while preserving its cultural and heritage essence.

Western Railway’s Restaurant to feature live music 

A decommissioned railway coach has been placed near the Grade-1 heritage Bandra station, which will soon be converted into a vibrant dining space.

Continue Exploring: Edible Oil manufacturer BN Group announces $1 Bn investment for African expansion

According to HT, the restaurant will feature seating both inside the coach and outside in an open-air arrangement, complemented by a podium for live musical performances. Officials hope this move will deter autos from encroaching on the station premises, which has long been a cause of traffic congestion and inconvenience to commuters.

“Bandra is a melting pot of cultural diversity and heritage beauty. This project not only aims to streamline traffic but also create a space where people can gather to enjoy good food and live music,” said a Western Railway official.

Open-air restaurant to hold cultural events, gigs

The open-air seating and thematic design will serve as an extension of the coach restaurant, with plans to host cultural events and gigs. Located adjacent to the Government Railway Police (GRP) station at Bandra West, the restaurant on wheels is set to rejuvenate the area. The railway officials believe the venture will face minimal bureaucratic hurdles as long as it doesn’t obstruct passenger movement.

Continue Exploring: JW Marriott Mumbai to introduce BarQat, eyes restaurant expansion

For years, the space outside Bandra station has been plagued by unregulated parking of auto-rickshaws, despite designated stands. The congestion often hampers commuters’ entry and exit. However, recent steps, such as clearing encroachments by vendors, have already eased the situation.

“The scene outside both east and west Bandra stations has been chaotic. Though the station’s revamp has improved things, the autos still create traffic jams. This initiative could bring some much-needed order,” said Kailash Verma, President of the Mumbai Commuters Council. 

As part of the plan, the concourse area outside Platform 1’s main entrance is also being considered for transformation into an art gallery, further enhancing the cultural appeal of the station. The restaurant on wheels sits against the backdrop of the recently renovated Bandra station building, which underwent a INR 12-crore restoration to restore its historic charm. The project saw the repair of intricate woodwork, polishing of wooden frameworks, and the restoration of the station’s stone facade and stained-glass windows to their original glory.

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Swiggy ropes in Flipkart’s DoS Kanika Tiwari as Head of Monetization

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Ashutosh Dubey
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Swiggy ropes in Flipkart’s DoS Kanika Tiwari as Head of Monetization

Swiggy, a leading online food delivery and quick commerce platform in India, has appointed Kanika Tiwari as the Head of Monetization for its quick commerce service, Swiggy Instamart.

Kanika was Director of Strategy and Growth for Flipkart Ads

Tiwari brings with her a wealth of experience from her successful tenure at Flipkart and other renowned organizations. With expertise in strategy, business development, and growth, Tiwari is expected to play a pivotal role in driving Swiggy Instamart’s growth.

Continue Exploring: Quick commerce sees record advertising revenue surge, led by Blinkit, Zepto

Tiwari’s professional journey with Flipkart spanned eight years, where she held key positions and played a crucial role in driving the company’s growth. Her most recent role at Flipkart was Director of Strategy and Growth for Flipkart Ads.

Looking forward to contribute Swiggy’s success – Kanika

“I want to thank Flipkart for the opportunities and experiences gained during my tenure. I am grateful to all the leaders I got to work with, who helped me become the professional I am today. Looking forward to this new chapter and contributing to Swiggy’s success,” added Kanika Tiwari.

Continue Exploring: Hotel brands to add 94,000 rooms across segments by 2028-29

Beyond her impactful tenure at Flipkart, Tiwari’s career began in 2011 as an Engineer at Ericsson. She later joined Rivigo in 2016 as a Business Development Manager and Key Account Manager. In her new role at Swiggy Instamart, Tiwari will focus on monetization strategies to enhance revenue streams for the platform.

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Goyal Salt ltd registers approx. 60% revenue growth, hits INR 74.82 Cr in H1FY25

By
Ashutosh Dubey
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0
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Goyal Salt ltd registers approx. 60% revenue growth, hits INR 74.82 Cr in H1FY25

Goyal Salt Limited, a FMCG player in the salt industry, has announced its unaudited financial results for the half-year ending September 2024. The company reported a revenue of INR 74.82 crore in H1FY25, marking a 59.67% growth.

Goyal Salt makes INR 46.86 Cr revenue in H1FY24

Last year, in the same period, the company reported INR 46.86 crore overall revenue. Further in H1 this year, EBITDA surged to INR 13.13 crore, recording a 2.2-fold increase from INR 4.11 crore in the previous period, while PAT grew 2.87 times to INR 9.33 crore, compared to INR 2.41 crore in H1FY24.

Continue Exploring: KRBL Ltd’s India Gate to expand portfolio with mixed spices and rice bran edible oil

The company secured a work order worth INR 21.86 crore from the Jharkhand government and achieved a historic procurement of 150,000 tons of raw material in Q1FY25, targeting record-breaking production and sales. 

Meanwhile, Pramesh Goyal, Managing Director, Goyal Salt Ltd. said, “We are delighted to report a good set of numbers. The growth in our profitability reflects the strength of the Goyal Salt brand in North India, especially Rajasthan, UP, Bihar, Jammu, and Jharkhand. We have emerged as one of the leading brands in the league of the top three salt brands in India.”

Continue Exploring: Patanjali Ayurveda reports fivefold profit surge to INR 6,460 Cr despite sales decline

Goyal Salt setups new plant in Gujarat

Goyal stressed that the company’s motive is to reach every household in the country. He also announced that the company is setting up a new plant in Gandhidham, Kutch, with an investment of INR 80 crore approx. This plant will be the largest in the salt capital of India and will strengthen the brand in the Western part of the country like Maharashtra and Gujarat.

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