It’s Losses Are Narrowing Quarter by Quarter. Risk-Reward Is Hard to Ignore.

Food delivery profitable, Instamart contribution break-even weeks away, revenue up 45% year-on-year — the path to profitability is becoming clearer, even if the timeline has shifted

Loss-making technology companies require a different kind of reading from investors. The question is never whether profits exist today — they don’t — but whether the trajectory of losses is moving in the right direction, and whether the business being built justifies the investment being made. On both counts, Swiggy’s fourth quarter of FY26 delivers a largely positive answer.

Revenue grew 44.7% year-on-year, EBITDA losses narrowed meaningfully, food delivery turned profitable on an annual basis, and Instamart’s contribution margin is within touching distance of break-even.

The Food Delivery Business Is Now Genuinely Healthy

Swiggy’s food delivery segment — the original business, and still the larger of the two — had a strong quarter. Gross order value grew 22.6% year-on-year to Rs 90.1 billion. Monthly transacting users reached 18.3 million, up 21% year-on-year. Adjusted EBITDA margin in food delivery was 3.3% — up 30 basis points sequentially and 41 basis points year-on-year. The out-of-home consumption business turned profitable on an FY26 basis. “Food delivery continues to grow faster than the sector with improving profitability,” ICICI Securities notes, attributing this to “consistent innovation and superior execution.”

For a business that was long seen as structurally disadvantaged against its better-capitalised competitor, these numbers represent a meaningful shift in the narrative.

Instamart — The Break-Even Is Now a Matter of Quarters

Quick commerce is where the investment thesis gets more interesting — and more complex. Instamart’s gross order value grew 68.8% year-on-year to Rs 78.8 billion. Monthly transacting users hit 13.3 million, up 35.7% year-on-year. Contribution margin has improved to -1.8% of GOV from -2.5% the previous quarter. Management has guided for contribution break-even by Q1FY27 — and ICICI Securities considers that guidance credible and in line with its own expectations.

The more nuanced point is what comes after contribution break-even. Management has indicated an increased focus on net order value growth — which means investing in the business to capture market share rather than optimising purely for profitability in the near term. As a result, ICICI Securities has pushed its adjusted EBITDA break-even estimate for Instamart from FY28 to FY29. This is the trade-off at the heart of the quick commerce story right now: the unit economics are improving, but the ambition to scale is requiring continued investment.

ICICI Securities estimates Instamart reaching a NOV target of Rs 1 trillion by FY31 — a number that frames the size of the opportunity management is chasing.

The Target Cut 

The target price has been revised down from Rs 600 to Rs 520, reflecting the earnings cuts in the quick commerce segment as the EBITDA break-even timeline extends. That is a meaningful cut — but one that still leaves 85% upside from the current price. “We think Swiggy continues to present a great risk-reward skew at CMP,” the report states plainly.

The bull case rests on a combination of factors: food delivery growing faster than the sector with expanding margins; Instamart approaching contribution profitability with a massive and growing user base; supply chain losses continuing to reduce; and a cash balance of Rs 150 billion as of March 2026 that provides a long runway to execute without needing to raise capital in a hurry.

The scorecard