Swiggy will invest in Instamart service, which is currently operational in 18 cities across India, and delivers more than one million orders per week.
Swiggy, which is in the midst of raising a larger funding round, said on Thursday it will invest $700 million in its express grocery delivery service Instamart as it looks to double down on non-food delivery categories.
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The move signals Swiggy’s aim to grow its quick-commerce business amid intensifying competition in the 10-minute grocery delivery space. Grofers, backed by Swiggy’s arch rival Zomato, had pivoted to a 10-minute grocery delivery model in August.
Swiggy also faces competition from e-grocery startup Zepto that launched this year and is delivering express groceries in Swiggy’s home market of Bengaluru, as well as in Mumbai and New Delhi.
Swiggy’s Instamart service, which is currently operational in 18 cities across India, delivers more than one million orders per week. It plans to make deliveries across locations in 15 minutes by January through ramping up its network of dark stores. Dark stores are physical warehouses that cater only to online orders. Swiggy partners with store owners to set up dedicated dark stores within a city for its Instamart business.
“We are at the place where we feel comfortable making a huge commitment only on the back of convenience grocery. We recently touched two million transacting users and that is a drop in the ocean compared to the target segment available for this category (of express groceries),” Sriharsha Majety, co-founder and chief executive, said in an interview.
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