India’s instant delivery race hits $15 billion, but losses exceed $1.4 billion

India is emerging as the only major market where ultra-fast delivery, or “quick commerce,” is scaling at unprecedented speed.

With over 730 million young, digital-first consumers and dense urban clusters, companies like Blinkit, Zepto, and Swiggy Instamart are making 10-minute delivery a part of everyday shopping.

While similar models collapsed in the US, Europe, and China, India’s unique mix of consumer habits, low labour costs, and mobile-first payments is fuelling rapid expansion.

Yet, behind the surge are razor-thin margins and mounting losses, raising questions over sustainability. The sector has already lost more than $1.4 billion in four years.

Quick commerce valuations soar past $30 billion

Barely five years since launch, India’s top three players command valuations exceeding $30 billion. Blinkit, acquired by Eternal Ltd. (Zomato) for $570 million just three years ago, is now valued at $15 billion.

Zepto has reached a $6 billion valuation and is planning a public listing in 2025. Swiggy, with Instamart contributing about 40% of its overall value, is pegged at $12 billion.

SoftBank, Temasek, and Tencent are among the global backers of this boom, with Bloomberg Intelligence forecasting that India’s quick commerce market will expand from $6 billion today to $100 billion by 2035.

That would account for nearly 20% of total e-commerce sales in the country, compared with just 5% at present.

The rapid growth has placed Eternal in the benchmark BSE Sensex in December and the NSE Nifty 50 in March, highlighting the sector’s influence. Its shares more than doubled in 2024, though analysts warn the company trades at a 140% premium to global peers.

$1.4 billion in losses despite rapid expansion

The scale of losses has been staggering. Blinkit, Swiggy, and Zepto together have lost more than $1.4 billion (123 billion rupees) over four years, excluding Zepto’s FY25 results and Blinkit’s pre-acquisition numbers.

Swiggy is not projected to break even for at least another two years, while Blinkit is expected to reach profitability by March 2026. Zepto has said that 60% of its stores turned profitable in the June quarter, but the larger network is still heavily subsidised.

Despite the red ink, companies continue to expand their “dark store” networks. Blinkit runs 1,500 warehouses across 100 cities, Zepto has over 1,000 in 40 cities, and Swiggy operates more than 1,060 across 127 cities.

Franchisees invest about 8 million rupees ($92,000) per store and typically earn up to 3% monthly returns.

Competition intensifies as Amazon and Flipkart enter

The battle is no longer limited to domestic startups. Amazon entered the market in Bengaluru in December 2023, later expanding to New Delhi in July. The company said it plans to scale nationwide, leveraging its logistics to support ultra-fast delivery.

Flipkart launched its 10-minute “Minutes” service last year and already operates in 19 cities. Its fastest delivery, recorded in Bengaluru, was completed in just 3 minutes and 21 seconds. Reliance’s JioMart has also begun testing 30-minute grocery delivery.

With consumer loyalty hinging on discounts, competition is driving deep subsidy wars. Analysts say the model, which relies on selling goods below cost to capture market share, will be difficult to sustain long-term in a price-sensitive country like India.

Labour protests and retail closures raise risks

The impact is also visible on India’s streets. According to a retailers’ union, more than 200,000 small shops shut down last year as hyperlocal warehouses captured demand. At the same time, gig workers delivering for these apps have staged protests over pay and conditions.

In Varanasi, Blinkit riders went on strike during a 43C heatwave, demanding heatproof uniforms and fair pay. In Telangana, unions accused Zepto of exploitative practices, a claim the company denied. Delivery staff are often paid per order, incentivising speed but sparking safety concerns.

Despite this, consumer adoption continues to climb. Blinkit and Zepto both have more than 16 million average monthly transacting users, while Swiggy Instamart has about 11 million.

Items delivered range from groceries and electronics to gold coins and freshly prepared meals.