Swiggy set to invest $700 mn in Instamart
NEW DELHI: Food delivery platform Swiggy on Thursday said it will invest $700 million (about ₹5,250 crore) in its express grocery delivery service Instamart.
Swiggy Instamart - launched in Gurugram and Bengaluru last year - is now available across 18 cities and handles over one million orders per week.
In the last few months, Swiggy Instamart has onboarded more than one seller-run dark store every day, a statement said. By January 2022, it will make deliveries in 15 minutes by having the network of dark stores very close to the majority of its customers, it added.
While traditional e-commerce deliveries take a day or longer, quick commerce (or q-commerce) enables customers to get small quantities of goods to customers in a shorter period of time. Instamart competes with quick commerce (q-commerce) services offered by players like Zomato-backed Grofers and Dunzo. Last month, Ola had also started piloting a quick delivery service for items like groceries in Bengaluru.
In November, Grofers had said its dark store network was at over 200 stores, and that it is adding new stores at an aggressive pace. The company is looking at making these deliveries in under 10 minutes.
According to a RedSeer report, the quick commerce sector in India is expected to grow to $5 billion by 2025 from the current $0.3 billion.
Quik commerce is growing in India on the back of trends like a shift in consumer behaviour, entry of big players like BigBasket and Grofers, and rise of instant delivery platforms, as per the report. Swiggy CEO Sriharsha Majety said Instamart is set to reach an annualised GMV run rate of $1 billion in the next three quarters at its current growth trajectory. “With our food delivery business trending at a $3 billion annualised GMV run rate and Instamart’s supercharged growth, we are very excited about our convenience mission coming to life in a very big way,” he added.
Instamart offers an assortment of products across categories like fresh fruits and vegetables, daily bread and eggs, cooking essentials, beverages and others.
It is available in Ahmedabad, Bengaluru, Chennai, Coimbatore, Chandigarh, Delhi, Gurugram, Hyderabad, Indore, Jaipur, Kolkata, Kochi, Lucknow, Ludhiana, Mumbai, Noida, Pune and Vizag. In July this year, Swiggy had announced the closure of a $1.25 billion (approximately ₹9,345 crore) funding round led by SoftBank Vision Fund 2 and Prosus. As per sources, the closure of the round pegged the valuation of the company at $5.5 billion (around ₹41,125 crore).
Founded in 2014, Swiggy connects consumers to over 1.85 lakh restaurant partners and stores in over 500 cities.