Swiggy Share Price Sees Sharp Dip Amid Sector Weakness

Swiggy Ltd.'s share price saw a significant decline on Tuesday, falling by 10.62% to Rs 428, approaching its listing price of Rs 420. The drop comes amid broader market concerns affecting the food delivery sector, as peer Zomato also experienced a sharp 13% decline following a disappointing quarterly report.

Zomato's unexpected slowdown in its food delivery business in Q3 triggered a wave of investor caution, with brokerages downgrading Zomato’s stock and slashing target prices. This seems to have weighed heavily on Swiggy's shares, with investor sentiment across the sector becoming more cautious.

Zomato Ltd.'s share price dropped over 13% to trade at Rs 207 per share before recovering a little but still staying in red at 10.74% lower, Rs 214 apiece.

Late last week, Swiggy had announced the incorporation of a wholly owned subsidiary, Swiggy Sports Pvt., aimed at diversifying its business. The subsidiary will focus on sports team ownership, talent development, event organisation, and broadcasting rights, among other activities.

The scrip fell as much as 10.88% to Rs 427 apiece. It pared losses to trade 9.90% lower at Rs 431 apiece, as of 11:06 a.m. This compares to a 0.80% decline in the NSE Nifty 50 Index.

It has fallen 5.32% since listing. Total traded volume so far in the day stood at 1.5 times its 30-day average. The relative strength index was at 33.

Out of 14 analysts tracking the company, nine maintain a 'buy' rating, two recommend a 'hold,' and three suggest 'sell', according to Bloomberg data. The average 12-month consensus price target implies an upside of 36.6%