As food delivery slows, can Dineout be Swiggy’s saviour?

Out-of-home experiences are having a moment in India. International artists are filling venues like never before, and the restaurant, premium dining, and nightlife scenes are booming. From cocktail bars slinging exotic ingredients to new neighbourhoods in cities like Bengaluru and Noida teeming with novel venues, eating (and drinking) out is on the upswing.

Last month, international brokerage firm Macquarie said it remains cautious on both Swiggy and Zomato, citing concerns over slowing growth in food delivery and rising losses. Instead, the brokerage favoured stocks such as Devyani International and Westlife Foodworld—two major restaurant operators—on the expectation that dining in would be a new growth engine. 

Swiggy and Eternal (formerly Zomato) have long since recognised these shifts in food consumption patterns. Citing a Redseer report, Swiggy’s IPO papers from last year estimated the online dining out market in India was valued at approximately $600 million in 2023 and would grow between 46%-53% annually between 2023 and 2028. This is far higher than the growth being recorded in food delivery, albeit from a far lower base.