Swiggy's H1 FY24 Food Delivery Revenue Hits $1.43 Billion, Up 17 pc: Prosus

Prosus, Swiggy's major investor, revealed that in the first half of Financial Year 2023-24 (H1 FY24), Swiggy experienced a 17% growth in its food delivery segment, achieving a gross merchandise value (GMV) of $1.43 billion.

Prosus, highlighted in its yearly financial report, attributed Swiggy's success to an increase in active users, which fueled a double-digit surge in orders along with a rise in the average order value due to inflation.

The Netherlands-based global assets division of the South African conglomerate Naspers holds a 32.7% share in Swiggy.

In its financial results for H1 FY24, Zomato, a Gurugram-based competitor of Swiggy, reported a gross merchandise value (GMV) of approximately $1.84 billion, surpassing Swiggy's performance in the same period.

Swiggy's gross merchandise value (GMV) continues to exhibit growth at 28%, supported by improving operational metrics.

During H1 FY24, the food delivery platform's trading loss decreased to $208 million, a notable improvement from the $321 million reported in the corresponding period last year.

Prosus stated that during the first half of 2024, the fundamental EBITDA losses in food delivery significantly decreased by 89%. This reduction primarily stemmed from enhancements in contribution margins and operational efficiencies. Overall, this reflects a customer inclination to pay for convenience and restaurants' eagerness to promote for expansion, as per Prosus' interpretation regarding earnings before interest, taxes, depreciation, and amortization (EBITDA).

Instamart, Swiggy's fast delivery service operating in 25 Indian cities, experienced significant advancements as a result of customer-driven order growth.

The size of purchases notably increased well above the rate of inflation. By June 2023, Instamart expanded its store presence by 19%, thereby significantly contributing to a 63% growth in its gross merchandise value (GMV).

In the first half of the fiscal year 2023-24, Instamart experienced a substantial 75% reduction in losses due to its increased scale and enhanced profitability.

Prosus highlighted that a wider range of products, a more concentrated store network, and quicker delivery times have consistently supported the acquisition and retention of customers.

Earlier this year, Swiggy's CEO, Sriharsha Majety, mentioned that the food delivery segment achieved profitability during the March quarter, factoring in corporate expenses and excluding employee stock options.

In October, Invesco, a U.S. fund manager, raised the Bengaluru-based company's valuation to $7.85 billion (around Rs 65,000 crore).

This revision followed two decreases earlier in 2023, marking Invesco as the second investor this year to increase the valuation, marking a surge of almost 43% from the previous $5.5 billion valuation provided by Invesco as of July 31.

In August, Baron Capital, a US-based asset management firm, increased the food aggregator's valuation by 33.9% to $8.54 billion.

On the other hand, Zomato achieved its first profits of Rs 2 crore in Q1 FY24. Subsequently, the company recorded its second consecutive quarter of consolidated net profit, reaching Rs 36 crore in Q2 FY24.