Swiggy to invest $700 million in Instamart to crack online grocery delivery space

Online food delivery firm Swiggy will invest $700 million in its express grocery delivery business Instamart, the Softbank-backed firm has said, as it seeks to double down on a category that has grown at a scorching pace since it was launched in the middle of the pandemic last year.

Swiggy's move to commit a huge investment to Instamart also comes at a time when there is heightened competition in the so-called quick commerce space in India- where startups are promising delivery of essentials in under an hour.

From Zomato-backed Grofers to Dunzo to Amazon to Flipkart to Zepto to Tata-owned BigBasket to Reliance-owned JioMart - everyone is vying for a larger pie of this market, as more Indians shop for daily essentials online.

Swiggy said it is currently clocking more than 1 million orders per week and will start 15-minute deliveries to top cities by January 2022. Launched in Gurugram and Bengaluru in 2020, Instamart now serves customers in 18 cities.

Instamart offers an assortment of products across categories like fresh fruits and vegetables, daily bread and eggs, cooking essentials, beverages, instant food and munchies, personal and baby care, home and cleaning.

This is Swiggy's second attempt to crack the online grocery delivery space. It had launched and shut Swiggy Stores earlier, which operated on a marketplace model. But Instamart operates via the dark stores model. Dark stores typically resemble conventional supermarkets, except that they are open to online orders only.