Amazon India is reportedly in early discussions with Swiggy regarding a potential deal involving Swiggy’s quick commerce business, Instamart. According to sources familiar with the matter, the U.S. e-commerce giant is exploring options to either acquire a stake through a pre-IPO placement or propose a buyout. These talks coincide with Swiggy’s recent confidential filing of draft documents with SEBI for a Rs. 10,414 crore ($1.25 billion) public offering.
“Amazon has shown interest in picking up a stake or even proposing a buyout for Instamart,” said one source. However, the discussions are still in preliminary stages, and no official offer has been made. The complex structure of the potential deal presents significant challenges, according to insiders. “Swiggy is unlikely to sell only its quick commerce business, and Amazon is not interested in the food delivery sector, where growth is plateauing,” added the source.
Swiggy, valued between $10 and $12 billion, is considered too expensive for a full acquisition by Amazon, which typically avoids minority stakes. Amazon India declined to comment on the speculation, and Swiggy did not respond to queries.
Swiggy’s quick commerce vertical, Instamart, along with its competitors like Zomato’s Blinkit and Zepto, are at the forefront of the rapidly growing quick commerce sector. A Goldman Sachs report in April valued Blinkit at $13 billion, reflecting its significant market potential.
Amazon’s interest in Instamart aligns with its own efforts to develop a quick commerce initiative in India. However, any such move would require global clearance, as Amazon currently does not offer this service in other markets.
Swiggy has been offloading secondary stakes at a valuation of around $9 billion, aiming to reduce the shareholding of Prosus, one of its oldest backers. Prosus is in the process of paring its ownership to below 26% to avoid being classified as a promoter when Swiggy goes public.
Previously, Flipkart had explored a similar deal with Swiggy, but talks fell through due to valuation mismatches. Flipkart has since launched its own quick commerce service, Flipkart Minutes, and plans to expand aggressively in this space.
The quick commerce sector has seen explosive growth, with India’s e-commerce market growing 18–20% in value in the first half of this year, driven by a 38% surge in grocery sales. Quick Commerce now accounts for nearly 40% of online grocery sales, with the top three players leading this expansion.
Analysts’ project that India’s quick commerce market could be worth $6 billion by 2025, a significant increase from its negligible size just a few years ago. This rapid growth has prompted traditional e-commerce players to bolster their quick commerce capabilities to retain their customer base.