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Swiggy may exit Rapido over conflict of interest; Instamart GOV soars 2X in Q1 FY26

EntrackrEntrackr · 22d ago
Swiggy may exit Rapido over conflict of interest; Instamart GOV soars 2X in Q1 FY26
Medial

Foodtech major Swiggy, which holds a strategic stake in mobility company Rapido, has flagged a potential conflict of interest with the firm. In a stock exchange filing, Swiggy said it is “actively re-evaluating” the investment, citing the evolving nature of their business relationship. Swiggy owns a minority stake of around 12% in Rapido, an investment that has seen significant value appreciation over time. The company has hinted at a possible monetization of this stake to strengthen its balance sheet. Swiggy had led a $180 million round in Rapido in April 2022. Since then, Rapido has entered the unicorn club and recently extended its $200 million Series E round led by Nexus in June. Notably, Swiggy has not participated in any funding rounds after its initial investment. The development comes amid decent quarterly performance by Swiggy. In Q1 FY26, the firm’s consolidated Gross Order Value (GOV) rose 45.2% year-on-year to Rs 14,797 crore, as per its latest shareholder letter filed with the exchanges, supported by momentum across food delivery, quick commerce (Instamart), and out-of-home consumption categories. The food delivery business contributed Rs 8,086 crore to the overall GOV, registering a YoY growth of 18.8% from Rs 6,808 crore in the same quarter last year. Swiggy added 1.2 million Monthly Transacting Users (MTUs) in the segment, taking the total to 16.3 million, the highest addition in the past eight quarters. The company also mentions its 6.06 lakh average monthly transacting delivery partners in Q1 FY26, with the total orders of 264 million. Despite volume growth, food delivery margins came under pressure due to seasonal headwinds. The adjusted EBITDA margin slipped to 2.4% from 2.9% in Q4 FY25, primarily due to reverse-migration of delivery partners during the monsoon and annual employee appraisals, the company said. Instamart saw strong momentum in the quarter, with GOV at Rs 5,655 crore, a 107.6% increase compared to Q1FY25. The quick commerce unit’s Average Order Value (AOV) reached Rs 612, up 25.7% year-over-year. Total orders stood at 92 million in Q1 FY26. Swiggy expanded its dark store network by adding 41 locations during the quarter, bringing the total to 1,062 across 127 cities. The company focuses on optimizing existing capacity and adds stores selectively in demand-heavy areas. Swiggy closed the quarter with Rs 5,354 crore in cash and cash equivalents. The firm reiterated its commitment to scaling Instamart while maintaining a guided path toward contribution margin breakeven between Q3 FY26 and Q1 FY27.

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