Bernstein says Eternal is its preferred pick in the sector, citing Blinkit’s stronger operating metrics, lower cash burn, and more established contribution margins. The brokerage has a target price of Rs 370, implying an upside of 31% from current market levels.
According to Bernstein, Blinkit has the ability to retain its leadership position and believes that the current price offers a more favorable risk-reward proposition given its established positive contribution margin, better operating metrics across the board and a much lower cash burn. The brokerage believes most of the competitive pressure and resulting impact is already priced in the stock.
For Swiggy, over the longer term, Bernstein remains positive on its ability to deploy expanded cash cushion to scale its dark store network, improve operating metrics and strengthen unit economics. Bernstein maintains its Outperform rating and forecasts 42% upside (Rs 500 target price) from current levels.
Here’s what the brokerage says about the ever-evolving space.
Swiggy, Zepto follow closeIn 2025, the performance gap between leaders (Blinkit, Instamart, Zepto) and challengers Flipkart, Amazon, BigBasket, and JioMart grew materially. But 2206 will be different, says Berstein, adding that collective focus by leaders on core customer cohorts to ‘lock-in’ unit economics and efforts by challengers to establish a foothold before it is ‘too late’, would heat the battle. As a result, analysts suggest aggressive discounting in the first half of 2026 and store expansion all across.
QC in 2026
Quick commerce growth is expected to remain strong, with the industry projected to expand by around 80% in 2026, driven by continued dark store additions, deeper discounting and wider category offerings. While customer use-cases remain largely similar across platforms, the three market leaders have developed increasingly differentiated strategies over 2025. Bernstein believes that strategic positioning, capital allocation — including the ability to absorb near-term losses — and execution will be key in determining winners. It also expects the wide divergence in market estimates to narrow through 2026, with Blinkit likely to continue outgrowing Instamart and Zepto.
Margins hard to predict
Bernstein expects margin trajectories in quick commerce to remain choppy and difficult to predict, as Eternal and Swiggy enter 2026 with strong cash positions and competitive intensity showing no signs of easing. With the focus firmly on defending and gaining market share across micro-markets, players are likely to sacrifice margins in response to competitive pressures. The brokerage flags limited visibility on margins beyond one or two quarters, given the need to react quickly to moves by rivals.
How should investors ride 2026?
For investors, Bernstein describes this as a tricky phase for quick commerce. It advises buying the sector with long-term conviction, noting that the profitable serviceable addressable market remains large and that operating metrics per store are more meaningful indicators of leadership than headline scale.The brokerage expects Blinkit to remain the market leader, but cautions investors to be prepared for a volatile year. It highlights key monitorables including Zepto’s IPO filing and milestones, growth initiatives at JioMart, execution consistency at BigBasket, and the pace of aggression and capital allocation by Flipkart and Amazon. With Instamart also likely to push growth following its recent capital raise, Bernstein expects continued pressure on customer acquisition. Overall, the brokerage views quick commerce as a new and improved retail format rather than a platform business, making the trajectory of unit economics the key valuation driver.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)