BENGALURU: India’s quick commerce sector may be entering a new phase where blistering growth begins to cool even as the overall momentum remains intact.
Eternal Ltd’s Q4 shareholder letter showed Blinkit’s net order value (NOV) grew 8% to ₹14,386 crore sequentially, compared to 13% growth QoQ in the previous quarter. On the other hand, Instamart’s gross order value (GOV) fell to ₹7,881 crore from ₹7,938 crore in the previous quarter. It grew 13% QoQ in the previous quarter.
The slower quarterly momentum points to a turning point for the segment, highlighting that quick commerce is expanding fast but growth is starting to normalize as competition intensifies. Eternal’s management acknowledged the impact of intensifying competition on growth dynamics.
“High competition can have adverse impact in certain periods of time, like the one we are going through now, where aggressive discounting is leading to poor-quality growth centred around select low-margin SKUs. But more broadly and longer term, good competition will aid our growth as well as the growth of the market over the next few years,” Albinder Dhindsa, CEO of Eternal, said in the Q4 letter to shareholders.
The management maintained that the slowdown is a natural evolution.
“Growth rates are now naturally moderating off a much larger base,” it said, reiterating expectations of an over 60% CAGR for Blinkit over the next three years.
Swiggy, which operates Instamart, also acknowledged mounting competitive pressure.
“The quick commerce category continues to remain a very highly competitive segment in a multi-player market. The increasing competition has only made it clearer to us that increasing our staying power and doubling down on our differentiation is the only path to winning in the medium term,” said Sriharsha Majety, MD and group CEO of Swiggy.
Weak differentiation
Analysts said the competitive intensity is unlikely to ease soon. Arvind Singhal, chairman at retail consultancy The Knowledge Company, argued that differentiation remains weak across platforms.
“For the last three years, I’ve never seen a sustainable competitive advantage as far as quick commerce is concerned,” he said.
With consumers largely driven by price and convenience, loyalty remains thin.
“Customers are rational. Everything today is available on the swipe of a thumb,” Singhal added, pointing to discounting as the primary lever driving usage rather than structural demand shifts.
Even as competition weighs on near-term growth quality, Eternal continues to double down on expansion. The company added a net 216 new stores in Q4, taking its network to over 2,200 locations, and outlined growth drivers spanning assortment expansion, geographic rollout and demand density.
Swiggy said its focus was on improving unit economics and margin integrity over vanity volume.
“Having reflected hard and been buoyed by early green shoots we are seeing with some differentiation efforts, we feel definitively that the right answer for Instamart’s long-term success will be more differentiation-led and not value/price-led,” Majety noted.
Yet, questions about long-term sustainability persist. Singhal remains sceptical about the economics of the model.
“There is very little long-term economic case for quick commerce. The delivery cost is significant and it’s a single-order system,” he said, highlighting structural challenges in logistics and margins.