Swiggy shares fall nearly 6% as traders book profits on Day 2 after listing

Shares of leading food delivery player Swiggy edged lower to 5.6% to Rs 430.30 on BSE after rising over 7% in the morning trade on Thursday. The company’s shares ended its debut day at about 17% premium against the issue price of Rs 390 on Wednesday.

The company's ongoing losses and challenging market conditions may dampen investor enthusiasm over the long term, said Shivani Nyati, Head of Wealth at Swastika Investmart. “Still, Swiggy's strong brand recognition, extensive network, and leading position in the food delivery market drive optimism about its growth potential.”

Meanwhile, the company’s market capitalization crossed Rs 1 lakh crore mark on its debut day.


However, the share price of Swiggy ended at Rs 429.85, down 5.72% from the previous day's close. The market cap also saw a drop below the Rs 1 lakh crore mark and ended at Rs 96,219.66 crore on Thursday.

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“Investors should approach Swiggy with a balanced perspective, considering the potential for future growth and the associated risks. Those who are holding it may keep a stop at around the issue price,” Nyati said.

Many investors are staying on the sidelines in the current market environment, particularly as many high-quality companies are still trading 15-20% below their peak values, brokerage Lemonn Markets said.

“However, for those with a higher risk appetite, Swiggy could be an opportunity to capitalise on the valuation gap between Zomato and Swiggy, with potential gains hinging on Swiggy’s ability to enhance operational efficiency over time,” said Gaurav Garg, Research Analyst at Lemonn Markets Desk.

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Swiggy has demonstrated strong growth potential, but ongoing losses in recent fiscal years indicate potential challenges ahead. Investors may need to prepare for a dynamic path as the company works to balance its expansion efforts with sustainable financial performance, Bajaj Broking Research noted.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)