Rapid Delivery Wars Explode: Amazon and Flipkart Launch $15 Billion Challenge Against Quick Commerce Leaders Eternal and Swiggy

Rapid Delivery Wars Explode: Amazon and Flipkart Launch $15 Billion Challenge Against Quick Commerce Leaders Eternal and Swiggy​

The hypergrowth of India's rapid delivery segment has hit a critical inflection point. The massive market excitement is now facing intense pressure as titans like Amazon and Walmart’s Flipkart aggressively enter the quick-commerce space. This influx of deep-pocketed competition has led to a substantial selloff, with Eternal Ltd. and Swiggy Ltd. seeing their valuations severely tested in the highly competitive landscape.

E-Commerce Giants Intensify Battle for Last-Mile Dominance​

Amazon.com Inc. and Flipkart are dramatically scaling up their operations to capture market share from established quick commerce players. Amazon, which began ultra-fast deliveries last year, announced plans to expand its Amazon Now service into over 300 Indian cities and towns. This expansion comes with a pledge of an additional $13 billion investment into building out its AI and cloud infrastructure across the country.

Flipkart Minutes is also escalating its physical footprint aggressively. According to reports, Flipkart has scaled up to 1,000 dark stores serving 130 cities in under two years. The company plans to establish another 1,500 stores targeting over 180 cities in the near future.

Stocks Plunge as Competition Drives Valuation Concerns​

The sudden competitive onslaught has directly impacted the rapid delivery sector. Eternal Ltd., which operates Blinkit, slipped a significant 28% from its October all-time high by Thursday’s close. Similarly, Swiggy, owner of Instamart, plunged approximately 47% from its recent peak recorded in September. Collectively, this translates to a more than $15 billion selloff for the two companies.

Analysts are tempering market enthusiasm due to the prolonged intensity of the rivalry. Yi Ping Liao, a fund manager at Franklin Templeton holding shares in Eternal, noted that "The risk is the duration of the competitive intensity," stating that near-term profitability is depressed by high competition. Macquarie analysts Aditya Suresh and Baiju Joshi reinforced this sentiment, writing that persistent competitive intensity should be expected "for years, not quarters."

Broader Market Trends and the Pricing Slugfest​

Beyond Amazon and Flipkart, the entire quick commerce sector remains volatile. Reliance Retail Ltd., leveraging its vast network of 3,100-plus brick-and-mortar stores serving over 1,200 cities, is actively using its JioMart platform to push into rapid commerce. This move adds yet another giant to the delivery domain.

The pricing war appears inevitable, with companies going all-in on deep discounts for market share. While Blinkit managed to demonstrate Ebitda-level profitability in the December quarter, Swiggy’s quick commerce operations registered an annual loss of about $460 million, and Zepto recorded a loss exceeding $600 million.

The Vulnerability of Quick Commerce Startups​

The aggressive move by tech giants is also tempering excitement around smaller players like Zepto Ltd., which was originally known for its 10-minute deliveries. Despite being a local market originator, the company’s unlisted shares have fallen more than 32% since February, declining from 58 rupees to 39 rupees according to UnlistedZone.com data.

Nevertheless, Emkay analysts suggest that while the sector is in a "landgrab phase," the underlying demand surge provides optimism. They note that the quick-commerce model has successfully moved beyond metro cities and into Tier 2 and Tier 3 towns, underscoring its pan-India appeal despite the heated rivalry.