Swiggy (SWIGGY) | News Based Sentiment Analysis

• On September 8, 2025, Nomura initiated coverage on Swiggy with a 'Buy' rating and a Rs 550 price target, representing a potential 25% upside from the stock's closing price on September 5th. This optimism stems from the belief that Swiggy’s food delivery business is entering a "steady profitability trajectory" and will be a key cash generator, while quick commerce is also showing improving profitability.
• Motilal Oswal also turned bullish, upgrading Swiggy to 'Buy' on September 5, 2025, with a Rs 560 price target (a 32% potential upside). They revised upward their food delivery growth estimates for FY26-FY27 to 21-23%, citing faster-than-expected top-line recovery and improving unit economics.
• Investor enthusiasm surged following these analyst upgrades, driving Swiggy’s share price to a seven-month high on September 8, 2025, jumping 4.53% to Rs 458.95. The stock has risen 45% from its low of Rs 305.35 on May 2, 2025, and its market capitalization reached Rs 1.10 lakh crore.
• The GST Council’s announcement of an 18% Goods and Services Tax on delivery charges, effective September 22, 2025, introduces a new challenge. Analysts estimate this will add roughly Rs 2.6 per order for Swiggy, though the company has already increased its platform fee to Rs 15 (inclusive of GST) in some markets.
• Swiggy continues to focus on its quick commerce arm, Instamart, aiming for contribution margin profitability by Q2FY27. The company has nearly doubled its dark store count to 1,021 by the end of FY25, and its 10-minute delivery service, 'Bolt', now accounts for approximately 12% of overall deliveries.
• Despite a cash burn of ₹29 billion and a loss of ₹37 billion in the last year, Swiggy holds a healthy ₹37.9 billion in net cash as of September 8, 2025, and achieved 40% revenue growth, reaching ₹170 billion.
• CLSA assigned an "outperform" call with a Rs 509 price target on September 9, 2025, expecting 18-20% medium-term GOV growth potential in food delivery and a 60 bps annual margin expansion runway. IIFL also expressed bullishness, setting a Rs 535 target price and anticipating EBITDA/PAT positivity by FY27/28.

The Investment Story: September was a month of increasing analyst optimism for Swiggy, driving a significant rally in its share price. While challenges like the new GST on delivery charges exist, the company continues to focus on profitability in both food delivery and quick commerce, backed by a strong cash position.

What It Means for Investors: The positive analyst ratings and share price surge suggest growing confidence in Swiggy’s turnaround potential. However, investors should closely monitor the impact of the GST on delivery fees and the company’s progress towards achieving profitability in Instamart.

Looking Ahead: Investors should watch for Swiggy’s performance during the upcoming festive season, the impact of the platform fee increase on order volumes, and further updates on Instamart’s path to profitability. The company’s ability to navigate the new GST regulations will also be crucial.

The Bottom Line: Swiggy remains a high-growth, high-risk investment. The recent positive momentum is encouraging, but sustained profitability and effective management of new challenges are essential for long-term success.