Swiggy shares, which have already run up close to 50 per cent from their IPO price of ₹390, still have more room to run, according to JPMorgan as the brokerage initiated coverage on the stock with a ‘buy’ rating and a target price of ₹730.
JPMorgan’s price target implies a potential upside of 25 per cent in food delivery aggregator’s shares from Thursday’s closing levels of ₹582.2. This is also the highest price target for Swiggy’s shares.
JPMorgan’s rating action comes just a few days after CLSA ascribed a target of ₹708 with an “Outperform” rating. BofA also has coverage on the stock with a ‘buy’ rating and a target price of ₹690. The brokerage noted that the company’s food delivery segment is serving as the cash cow business, while Quick Commerce (QC) is a multi-year theme.
JPMorgan analysts see several positive catalysts for the company over the next six quarters. Swiggy may also witness rising momentum on the year and catch up on profit vs Zomato in both the food delivery and quick commerce businesses, it said.
JPMorgan on Swiggy
The global brokerage firm highlighted Swiggy’s position as a “dark horse” in India’s local services landscape and sees significant growth potential for the company, emphasising its renewed focus and improved execution in both food delivery (FD) and quick commerce (QC). The note added the company is expected to hit a critical scale across both core businesses, which will help enable faster-than-peer expansion in profitability over FY2025E-28.
This confidence stems from Swiggy’s ability to enhance operational efficiency while driving robust growth in its key segments.
Additionally, JPMorgan sees Swiggy as an “underappreciated winner” in the Indian local services ecosystem, underscoring its potential to emerge as a major player.
However, the brokerage believes that the rising competitive risks in the quick commerce space from emerging e-commerce players like Amazon, and Flipkart, and price aggression from Zepto and Blinkit may pose risks to value creation.
At the current price, Swiggy is trading at 1.8 times Enterprise Value to Gross Order Value (EV / GOV) and at 6.1 times Enterprise Value / Revenue (EV / Revenue) on financial year 2026 earnings estimates, a 32% to 42% discount to Zomato, which JPMorgan believes is “overly pessimistic.” This disparity could provide investors with a lucrative entry point as Swiggy strengthens its market position, it added.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
