Fierce discount battles among India's quick‑commerce apps are slowing profit recovery, says Swiss bank UBS.
Discounts are getting deeper
UBS’s pricing tracker shows discounts have risen by 200‑300 basis points since September. The trend continued into January 2026, making offers even bigger than in November 2025.
Who is discounting the most?
- Amazon and Zepto are leading the price cuts, offering the biggest promos.
- Blinkit (part of Eternal) keeps discounts lower than its rivals, but still higher than before.
Impact on Swiggy and Blinkit
UBS kept a “Buy” rating on both companies but cut their price targets:
- Blinkit (Eternal) target lowered from ₹400 to ₹375.
- Swiggy’s Instamart target reduced from ₹580 to ₹510.
Adjusted EBITDA forecasts were also trimmed – by up to 18% for Eternal and up to 28% for Swiggy over the next two‑to‑three years.
Margin recovery pushed back
Because of the discount war, UBS now expects Blinkit’s quick‑commerce unit to break even in FY27, a year later than earlier forecasts. Swiggy’s Instamart margins are projected to fall 120‑130 basis points between FY27 and FY30.
Long‑term outlook
Despite short‑term profit pressure, UBS believes new platforms and expanding product categories will grow the overall market, giving the sector a solid growth path in the years ahead.
Takeaway
Heavy discounting is delaying margin improvement for India’s quick‑commerce players, but the expanding market may still offer upside for investors.
Disclaimer
These insights are based on analyst opinions, not guarantees. Do your own research or consult a qualified advisor before making investment decisions.