Thread by @zerodhamarkets

The quick commerce industry is moving faster than anyone expected. So much has changed in just a few months that it is worth stepping back to see where things stand. A 🧵 on whats happening.

Zepto raised new capital and is now rumored to be inching toward an IPO. Reliance Retail said it has shifted its quick-commerce model to 30-minute delivery by riding on its nationwide store network. Swiggy is raising funds after earlier saying it did not need external capital. Blinkit is adding stores at record speed. The momentum is remarkable.

We are skipping the debate on valuations. What matters here is what the two biggest listed players, Swiggy and Eternal (Zomato), actually said and did this quarter. This space changes so quickly that every quarter feels like a fresh chapter.

Let’s walk through how quick commerce performed this quarter.

Swiggy’s adjusted revenue came in at ₹2,206 crore, up 22% from last year.

Eternal reported adjusted revenue of ₹13,968 crore, growing 172% year on year.

Image: BSE.

A large part of this came from Blinkit. Compared to the previous quarter, Blinkit’s revenue jumped more than 3 times, which sounds unbelievable at first glance.

But there is a catch. Blinkit has spent the past year shifting from a marketplace model to an inventory-led model. It now buys and owns the products it sells. This makes old comparisons tricky because the accounting treatment changes. The 3x revenue jump is mostly an accounting effect.

Image: BSE.

If you look at net order value, which strips out discounts and reflects the real value of customer orders, the picture is clearer. Blinkit grew around 100% year on year. That is strong and much more representative of its underlying scale.

Image: BSE.

On the surface, both companies look like they are growing well. But in q-com, revenue is becoming less useful as a measure. The real signals are in costs, cash burn, and expansion choices.

Swiggy is a good example of why this matters. Its losses widened to about ₹1,100 crore, nearly double last year’s number.

Image: @Tijori1

Without stating it directly, Swiggy acknowledged that Instamart’s path to breaking even is not going as planned. Earlier, management expected Instamart to hit contribution margin breakeven between December 2025 and June 2026. This quarter, they quietly stopped mentioning the earlier date and only repeated the outer limit.

Image: Swiggy Conference Call.

Eternal, on the other hand, stayed profitable as a whole. It reported adjusted EBITDA of about ₹224 crore. Blinkit’s margins improved slightly, though it still loses money because marketing costs surged and the company added more than 270 new stores.

Eternal’s food delivery business continues to generate profits, and a significant portion of that now effectively supports Blinkit’s expansion.

Food delivery, once the main story for both companies, has reached a stable equilibrium. It is no longer the chaotic, explosive market of a few years ago.

Image: BSE.

Swiggy’s food delivery arm kept growing steadily. Margins improved to about 3%. Swiggy did not break out numbers for Bolt, its 10-minute food delivery option, but earlier quarters showed Bolt contributes meaningfully, and those users retain well.

Eternal’s food delivery business is also stable but showing slower growth. It grew around 15%, and management acknowledged the slowdown. Margins improved mainly because platform fees were raised midway through the quarter, shortly after competitors raised theirs.

Image: Eternal Conference Call.

Eternal said slower growth was due to weaker discretionary spending, a shortage of delivery partners as q-com firms ramped up hiring, and some customers choosing packaged food on Blinkit instead of restaurant orders.

Eternal believes food delivery will grow faster over the long run, but right now it is moving in a slower, more predictable rhythm.

If food delivery built the foundations of these companies, quick commerce is where they are pouring most of their energy today.

Swiggy took a measured approach. It added only about 40 Instamart stores this quarter, a major slowdown compared to last year when hundreds were added.

Image: BSE.

Their reasoning was simple. Many existing stores can still double their daily order volumes. Only about 25 percent of Instamart stores are contribution-margin positive today. Swiggy wants to extract capacity from its current network before expanding aggressively.

Image: Swiggy Conference Call.

Blinkit, meanwhile, accelerated. It added more than 270 stores this quarter, taking its network close to 1,800. It wants to hit 3,000 stores by March 2027.

The more interesting part is where Blinkit is adding stores. Eternal said 70 to 75% of new stores are in the top 10 cities. They are saturating affluent, high-frequency markets rather than spreading across India. A store in South Delhi or Mumbai can generate many times the volume of a store in a smaller city.

Blinkit is also 80% through its shift to a full inventory-led model. Owning inventory gives more control over selection and pricing, and allows direct brand negotiations. But it adds first-mile costs because sellers no longer deliver goods to stores.

Blinkit expects the full margin benefit of this shift to show up over the next four to six quarters.

Image: BSE.

Zepto also wants to move to an inventory-led model. But India’s FDI rules require majority domestic ownership for a full 1P business. Zepto does not meet this requirement yet, which is why investors like Motilal have increased their stake.

Quick commerce is growing faster than expected. Blinkit said it expects order volumes to grow more than 100% for at least the next one to two years. With that kind of growth, the company prefers to chase market share first and improve margins later.

On the capital side, the race is heating up. Swiggy announced an ₹11,000 crore QIP this quarter. This was surprising because just a few months earlier the CFO said the company had enough cash. Swiggy now says the new funds are meant to create a strategic reserve and support growth.

Blinkit raised capital last year for similar reasons, and Zepto’s recent fundraise also goes toward expansion and customer acquisition. At the same time, Swiggy and Zepto have removed most fees, such as surge and handling charges, to stay aggressive and reduce customer friction.

The bottom line: the real action has shifted to quick commerce. That is where both companies are spending money, where competition is intensifying, and the biggest long-term bets are being made. Food delivery has become a steady, cash-generating business. Q-com is fast-moving and uncertain, but it is shaping almost every major decision today.

We cover this and one more interesting story in today’s edition of The Daily Brief. Read on Substack, watch on YouTube, or listen on Spotify, Apple Podcasts, or wherever you get your podcasts; just search for “The Daily Brief by Zerodha.”