In the world of online food delivery, Zomato and Swiggy are the names that come to everyone’s mind. Both the companies not only help in delivering your favorite food to your doorstep, but are also much talked about in the stock market. Let’s take a look at the financial performance, market position, and investment prospects of these two companies.
Who is ahead in financial performance?
Zomato story:
Zomato has taken a big leap in FY 2024.
The company’s total income stood at ₹12,961 crore, which is 67% more than last year’s ₹7,761 crore. This time Zomato has also earned a net profit of ₹351 crore, whereas earlier the company was in loss. The 23% CAGR growth in Gross Order Value (GOV) shows the company’s strong market hold.
Swiggy’s performance:
Swiggy also reported revenue of ₹11,634.34 crore in FY 2024.
However, the company incurred a net loss of ₹2,350.24 crore. This loss is less than last year, which shows that Swiggy is moving towards improvement. GOV’s 15.5% growth is less than Zomato’s, but the company is working on its fundamentals.
Who has the stronger hold in the market?
Zomato’s lead:
Profitability: Zomato’s strong profitability puts it in a better position in the market. User Base: Zomato has 18.4 million monthly transacting users (MTUs), while Swiggy has 12.7 million. Average Revenue Per User (ARPU): Zomato with ₹98 leads Swiggy (₹85).
Swiggy’s Strategy:
Swiggy is skilled in customer acquisition. Its customer acquisition cost (CAC) is lower than Zomato. However, it still needs to catch Zomato in terms of profitability.
Would it be right to invest?
Investment Advice for Zomato:
Zomato is the perfect choice for those who love stability.
The company’s strong market position, profitability, and superior financial performance make it a low-risk investment. Zomato stock can be considered for good returns in the short and medium term.
Investment Advice for Swiggy:
Swiggy is a high-risk, high-return option for those investors.
Swiggy may get a new identity in the market with the upcoming IPO. If the company improves its operations, it can bridge the valuation gap with Zomato.
