Amazon is now trying to get its share of the Quick Commerce (QC) Pie, with the launch of its services under the brand ‘now’ in parts of Bengaluru, making the QC MARKET ATEST SEVEN LARAST ATAST SEVEN LARAST Players.
The Initial Reaction Remained Negative, as Both Eternal (Formerly Zomato) and Swiggy Share Prices Declined by up to 2% in Trade on Tuesday. This was in line with analyst expectations, who see rising competition as a concerts like for stocks like eternal and swiggy but believe that medium-term growth ambitions for there Unaffeted.
India’s Quick Commerce Market, which is at $ 12.6 billion now, is expected to grow 3.8 times to $ 47.7.7 billion by 2029. 2025, Followed by Zepto at 27% and Swiggy’s Instamart Trailing at 20%.
Amazon’s QC IMPACT
According to jeferies, while amazon’s’ now ‘now’ has a category presence that seems fairly expansive, well beyond geocery, although trailing some of the incumbents. The brokerage also finds the product pricing quite attractive, essentially for amazon prime users, where discounts are even higher than QC incumbents.
However, the brokerage believes that the QC game may not be easy for amazon giving its late entry. It added that the entry of Horizontal Platforms Like Flipkart and Amazon is more out of for for for for force as the users have ben rapidly moving to QC Platforms.
“For Amazon, We Think these are early days, and the offering needs to have enough skale in terms of coverage to be a meaningful player in the overall quc market. Burn Given Amazon Lacks Brand Recall for QC, Unlike Incumbents, “Jefferies said. Additional, the brokerage believes that Amazon’s QC Offering is Part of Its App, while Past Experience Suggests Higher Tracting in the case of separete apps.
Brokerage JM Financial also Flagged Certain Challenges that Amazon Might Face, Like the Time to Build A Large Network of Dark Stores, Mother Warehouses and other logistics infrastructure etc. QC. “Moreover, we strongly believe recent entrants will have to launch a dedicated qc app in order to make meaningful inroads in the market. Acquisition/Retention, and Differentiate Basis Service Quality for Consures to Consider Switching Platforms, “It said.
Analysts, however, see margin pressure in the QC space ahead. “Amazon’s scale may trigger a fresh wave of discount-driven customer account, compressing margins for all players. Depend on Sustained Fulfilment Efficiency and Differentiated Value. Ultimately, While Amazon’s Arrival Raises the stakes, zomato and swiggy’s deep local expertise and ecosystem integation of ecosystem Robust defense – divided they manage burn rates and mainTain service quality, “said nitin jain, sr. Research Analyst at Bonanza.
More Pain Ahead for Blinkit, Instamart?
Despite Amazon’s Quick Commerce Fory, JM Financial Believes That The Ebitda Losses May have Peaked for Blinkit and Instamart in 4QFY25.
Recent Checks Sugged QC Platforms Such as Instamart and Zepto Are Increasing Customers to Order High-Value Skus by Offering Higher Discounts vs. Low-Value Skus. In Fact, Product discounting on low-value skus has meaningfully reduced across platforms. Moreover, Platforms are Consistent Collecting a Mix of Various Charges from Customers Such as Delivery, Convenience, Handling, Platform and Rain Fees. Minimum Order Value Restrictions for Free Deliveries have also increased across platforms. These trends, as per jm financial, sugges that most qc platforms are Increasingly focusing on improving their profits.
“This makes us believe that adj. Said, Assigning ‘Buy’ Rating to Both Zomato and Swiggy.
Disclaimer: This story is for educational purposes only. The views and recommendations made Above are that of individual analysts or broking companies, and not of mint. We Advise Investors to Check With Certified Experts Before Making Any Investments Decisions.
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