Swiggy to sell 12% stake in Rapido - should you still buy? What anaysts say

Swiggy share price has slipped over 21 per cent in 2025, and the food delivery giant is now looking to pivot its strategy by monetising the stake held in Rapido. The ₹2,400 crore sale, announced this week, is expected to free up capital for Instamart, its loss-making quick-commerce arm, which management hopes can emerge as the next growth engine.

The company will divest its entire 12 per cent holding in ride-hailing firm Rapido to MIH India Food Holdings BV (Prosus) and Setu AIF Trust (Westbridge) for a total pre-tax consideration of ₹2,400 crore. Prosus, which already holds a 23.3 per cent stake in Swiggy as of June 2025, will acquire ₹1,968 crore worth, while Westbridge will pick up the remaining ₹431 crore. The transaction, which more than doubles Swiggy’s 2022 investment of ₹950 crore, awaits shareholder and regulatory approvals, including from the Competition Commission of India.

Swiggy’s recent strategic moves, including the sale of its Rapido stake and restructuring of Instamart, have drawn mixed reactions from market analysts. While some see the monetisation as a timely financial boost for the company’s quick-commerce operations, others caution that it may only provide temporary relief amid growing competitive pressures and ongoing cash burn.

Nomura welcomed the monetisation, stating it provides “enough financial resources to weather the current burn phase of its Quick commerce (Instamart) business,” and retained a ‘Buy’ rating on Swiggy shares with a target of ₹550. The brokerage emphasised that disciplined execution and improved visibility on breakeven will be key catalysts for the stock.

JM Financial, however, offered a more cautious view, calling the Rapido exit “only a temporary solution” that extends Swiggy’s runway by roughly two quarters.

The firm retained a ‘Reduce’ rating with a target price of ₹440 on Swiggy shares, noting that the stake sale value fell short of its estimate of ₹2,900 crore and may not be enough to resolve the company’s balance sheet challenges. JM Financial highlighted the growing competitive threat from Blinkit, which expanded 130 per cent, warning that Instamart’s slower expansion strategy could cause it to lag significantly.

"Despite Instamart delivering 100 per cent-plus YoY GOV growth in recent quarters, it has been losing relative share to Blinkit, as the latter expanded 130 per cent. With Blinkit’s guidance suggesting plans to double its store count over the medium term, we believe Instamart’s curbed expansion strategy runs the risk of meaningfully falling behind its more ambitious competition," JM Financial said.

The brokerage further recommended a larger fundraise of more than $500 million, in addition to Rapido proceeds, to support Swiggy’s long-term ambitions in quick commerce.

The stock has surged nearly 30 per cent in the past six months but declined just over 2 per cent in the last month. Currently, it trades 31 per cent below its peak of ₹617 reached in December 2023, and has a 52-week low of ₹297 touched in May 2025.

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 making any investment decisions.

Catch all the Business News , Market News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

Download the Mint app and read premium stories