Zepto IPO: Blinkit vs Instamart vs Zepto, how the quick commerce rivals compare

Zepto IPO: DAM Capital, in an analysis of Zepto’s draft red herring prospectus (DRHP) alongside other quick commerce players, said the company is pursuing an order-maximisation strategy even as profitability remains under watch. The brokerage compared Zepto with Blinkit and Instamart on orders per store, store expansion, cash runway and unit economics as Zepto prepares for its planned IPO.

The analysis said Zepto is ahead of its rivals on daily orders per store, but this comes with lower net order value (NOV)  and a lower free-delivery threshold. It added that Zepto’s planned Rs 8,000 crore IPO is time-critical, with the company needing external funding for further expansion and competitive response unlike larger peers that can draw on other businesses.

According to DAM Capital, Zepto recorded 2,140 orders per day per store in Q4FY26, compared with 1,425 for Blinkit and 1,093 for Instamart. It said two factors explain the gap: a lower NOV per order, which was 26 per cent and 23 per cent below Blinkit and Instamart respectively, reflecting Zepto’s positioning; and a lower free-delivery threshold.

The brokerage estimated that less than 10 per cent of Zepto’s orders pay a delivery fee above Rs 199, while other orders get free delivery over Rs 99. It said contribution margin (CM) profitability would require a higher share of total orders to move from the FD99 bucket to the FD199 bucket, adding that for Blinkit all orders sit in the FD199-plus bucket.

DAM Capital said the key factor to watch is whether Zepto can increase per-store throughput to around 3,000 orders a day while also raising the free-delivery threshold from Rs 99 to Rs199.

It said the two work against each other, as a higher threshold can push up basket sizes but also risks losing the low-ticket orders that drive throughput.

By contrast, it said Blinkit and Instamart have taken the opposite route by monetising a higher absolute contribution per order through higher NOV, and described that as a more durable model.

With Amazon and Flipkart Minutes scaling dark-store additions and increasing spending, the brokerage said customer acquisition costs remain elevated and loyalty is still low in the category.

In that context, DAM Capital said Zepto’s threshold and discount structure becomes a retention cost rather than a transitional investment and cannot be withdrawn easily without a fall in volumes. It added that Zepto may need about 3,000 orders per day per store to reach adjusted EBITDA break-even, roughly 50 per cent above current throughput, and said doing that while competitive intensity keeps the free-delivery threshold below Rs 99 would be difficult.

On store expansion, the analysis said Zepto ended FY26 with 1,139 dark stores across 66 cities, adding a net 110 stores during the year through 169 openings and 59 closures. That marked a sharp slowdown from 692 net additions in FY25. Instamart also slowed materially, adding 122 stores to reach 1,143 stores across 129 cities, while Blinkit accelerated sharply, adding 942 stores to end FY26 with 2,243 stores, nearly twice the network of either peer.

DAM Capital said the slower rollout helped Zepto at the store level, where it had the highest throughput among the three at 1,677 orders per store per day, compared with Blinkit’s 1,417 and Instamart’s 1,044. It said Zepto follows a densification strategy, reflected in average delivery distance falling from 2.05 km to 1.78 km, and operates a hybrid model of direct leases and a Growth Partner franchise structure, which accounted for 36.6 per cent of stores at the end of FY26.

Looking ahead, Blinkit has guided for 3,000 stores by March 2027, or 3,500 to 4,000 if competitive intensity moderates, while Instamart plans a measured 30 to 40 additions a quarter with a focus on higher productivity from its existing network. Zepto’s DRHP sets out about 750 additions over the next two years, a 66 per cent expansion on its FY26 base, largely funded through IPO proceeds.

DAM Capital also said the IPO proceeds remain crucial. Assuming no major store additions and a burn rate of about Rs16 billion per quarter, based on the profit and loss run-rate over the past three quarters, it estimated Zepto has 3 to 3.5 quarters of runway before cash balances are exhausted. That, it said, makes the planned Rs80 billion IPO raise time-critical rather than opportunistic.

The brokerage said Zepto has no internal funding source, unlike Swiggy and Blinkit, which can use free cash from their food delivery businesses to support quick commerce losses and store expansion. As a pure-play operator with no adjacent profitable vertical to cross-subsidise the burn, every additional round of expansion or competitive response has to be funded externally, leaving Zepto dependent on capital markets or debt whenever cash runs low and with less control over the timing and pricing of fundraising than its two larger peers.

On unit economics, it said Zepto and Instamart were broadly at par in Q4FY26 but both trailed Blinkit. Zepto’s NRV per order stood at Rs 387, 26 per cent and 23 per cent below Blinkit and Instamart respectively, which the brokerage linked to its EDLP positioning and lower free-delivery threshold. On gross profit, Zepto operated at 18 per cent of NRV against Blinkit’s 27 per cent in Q4FY26, which it attributed largely to differences in scale and brand-level negotiations. At the adjusted Ebitda level, Zepto and Instamart stood at negative 16 per cent and negative 15 per cent of NRV respectively, while Blinkit was at 0 per cent in Q4FY26.