Swiggy To Command Lower Valuation Than Zomato In Public Market: Elara Capital

Brokerage firm Elara Capital expects Swiggy to command a lower valuation compared to its rival and food-tech major Zomato’s valuation in the public market as the Deepinder Goyal-led startup continues to outperform the IPO-bound company across several key parameters such as revenue, gross order volume, order count, among others.

In a recent research note, Elara Capital pointed out that Zomato’s business is bigger than that of Swiggy and has a higher growth rate than Swiggy. Besides, Zomato has market leadership in the quick commerce segment and has achieved profitability in the food delivery segment and break-even in the quick commerce vertical.

To trade on par or at a valuation premium to Zomato, IPO-bound Swiggy will not only need to gain market share in food delivery and quick commerce segments but also chart a path towards profitability, Elara Capital said. However, getting closer to Zomato’s adjusted EBITDA margin in the food delivery segment and breaking even in the quick commerce segment may be a “long haul” for Swiggy, as per the report.