India's Swiggy rises as Anand Rathi upgrades to 'buy' on improving profitability outlook

By Reuters News

** Shares of Indian food delivery firm Swiggy SWIG.NS rise as much as 2.8% to 235.50 rupees

** Anand Rathi upgrades stock to "buy" from "hold", retaining TP of 310 rupees, implying about 35% upside from brokerage's reference price of 230 rupees

** Brokerage says company's core food delivery business continues to generate steady profits, helping fund expansion and offset losses at quick-commerce arm Instamart

** Expects food delivery gross order value to grow 18%-20% annually over FY26-FY28, with margins expanding by about 210 basis points

** Says Instamart's shift towards a direct inventory model could improve contribution margins by 80-100 basis points, translating into savings of 4-5 rupees per order

** Flags intense competition and slower food delivery growth as key risks

** SWIG rated "buy" on average by 28 analysts, median PT at 350 rupees, according to LSEG-compiled data

** YTD, Swiggy stock down 39.53%

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