Global brokerage firm CLSA has given 'outperform' call for food delivery aggregator and quick commerce operator Swiggy Ltd and a target price of Rs 509 per share.
The target implies up to 17% upside for the Swiggy stock from its current market price.
At 10:50 am on September 9, Swiggy shares were trading 1.44% lower at Rs 436.75 apiece.
CLSA maintained its margin guidance for Swiggy's quick commerce business. The stock rose 47% in the last four months but is still down 41% from its 52-week high of Rs 617.
Swiggy's food delivery business has 18–20% medium-term GOV (Gross Order Value) growth potential and 60 bps annual margin expansion runway.
Last week, domestic brokerage firm Motilal Oswal Financial Services gave a target price of Rs 560 for Swiggy, which represents up to 28% upside.
"The food delivery and quick commerce industry has faced multiple headwinds over the past few months. Food delivery (FD) growth slowed due to weak consumption and macro pressures, while quick commerce (QC) profitability came under strain from heightened competition, accelerated dark store rollouts, and elevated customer acquisition costs. We now believe the cycle is turning," it said.
"Food delivery growth, which was stunted at 17-18%, could accelerate beyond 20% in the next 2-4 quarters, driven by the upcoming festive season and a spur from the recent GST reforms. In quick commerce, changes point to easing competition: new entrants have struggled to make a meaningful dent in market share; expansion pace peaked in 4QFY25; GST reforms could accelerate adoption in non-metros," the brokerage added.
MOFS raised food delivery growth estimates to 21-23% for FY26-FY27 (19-20% earlier), value at 35x FY27E EBITDA.
Meanwhile, brokerage firm Nomura has initiated coverage on Swiggy with a 'Buy' rating and a price target of Rs 550 per share, reported CNBC-TV18.
Nomura said that Swiggy's food delivery business is now on a steady profitability trajectory and is expected to remain a key cash generator. While the company's quick commerce vertical still holds a challenger position, profitability in this segment is also likely to improve.
The brokerage added that Swiggy is well funded to scale its quick commerce business further, and therefore the risk of equity dilution remains low. However, it cautioned that a broader macroeconomic slowdown could pose risks to growth assumptions in the online food delivery space.
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