Zomato and Swiggy: Rivals, IPOs, and the Road to Profitability

In an interview, Goyal stated that firms are able to plan more strategically and are less constrained by VCs' weekly evaluations, which makes negotiating public markets simpler. Deepinder Goyal, the group CEO and founder of Zomato, stated in an interview that the market would gain from the inclusion of another publicly traded food tech startup similar to Swiggy. His remarks are made about a week after Swiggy's $1.25 billion IPO—one of the biggest for a new age firm in recent memory—was approved by the Securities and Exchange Board of India (Sebi). The IPO is likely in the following several weeks.

In addition to competing in the food delivery business, Zomato and Swiggy are fierce rivals in India's rapidly expanding fast commerce sector, which has reached $5.5 billion in less than four years. Although they were tied until a few years ago, Zomato has closed the gap and is currently well ahead of Swiggy in both markets.

"Having a number of enterprises is beneficial to the industries. But we truly concentrate on our own work, therefore I'm not aware of anything else. There is nothing else that concerns us. What's going on out there, nothing,” Goyal told Moneycontrol when asked how he feels about Swiggy’s IPO during the exclusive interview.

Likewise, Swiggy's co-founder and group CEO, Sriharsha Majety, has previously told Moneycontrol that there are advantages and disadvantages to having a competition that is publicly traded. "The benefits of on-demand, gig workers, and hyperlocalization eliminate the need for us to define terms like these. The drawback is that you will be evaluated on the trajectory on a quarterly basis," he stated on August 9 at the Moneycontrol Startup Conclave in Bengaluru. “We definitely want to make sure that it is a good trajectory and there are many quarters that are good and some that are off – it (having a listed competitor) is a net positive for sure.”   

Public markets vs. Private Markets: 

Goyal discussed how he went from managing private market investors as an entrepreneur to managing a publicly traded firm. He noted that while the questions and expectations are similar, public markets are a little simpler.
"VCs want weekly data from you, and they have the right to visit your office and have meetings with you at any time. They also ask questions on a weekly basis. As a result, you truly cannot think beyond the next week; you must work every week. However, doing the proper things and doing quarterly assessments are far more long-term when a firm is publicly traded," he stated.

"Private investors just like exploring because they want to find anything that they believe is amiss with the company or startup. While there's nothing, it's all seasonality and all those things.”

Route to Financial Success:

Since going public three years ago, Zomato has reduced its losses annually and is now profitable. The stock has also been soaring, with a market valuation that has approached $30 billion in recent weeks because to the success of its B2B company Hyperpure and its fast commerce company Blinkit.

Swiggy's revenue increased by 36% for the entire year, from ₹8,265 crores in FY23 to ₹11,247 crores in FY24.

Read all about About Swiggy IPO

To Summarize

In a recent interview, Zomato CEO Deepinder Goyal praised Swiggy's upcoming IPO, stating it benefits the food tech market overall. He highlighted the shift from private to public markets, noting that quarterly evaluations allow for more strategic planning. Zomato’s success has driven its market valuation near $30 billion, thanks to its profitable B2B and fast-commerce ventures. Meanwhile, Swiggy saw 36% revenue growth from FY23 to FY24, underscoring fierce competition in India’s expanding fast commerce sector.