Mumbai: Swiggy’s ultra-fast grocery delivery service, Instamart, crossed 2 million transacting users, the food delivery platform said in an Instagram post.

Instamart specialises in grocery deliveries in 15-30 minutes. The pilot service
was launched in August last year in Gurugram and Bengaluru. It has since expanded to 17 cities, amid a push to scale up this business vertical.

Swiggy cofounder and CEO Sriharsha Majety
had told ET in an interview in July that as much as 25% of its revenue was coming from non-food delivery businesses, which would grow further in the next five years.

The company is investing a significant chunk of its recently raised capital to scale up its non-food delivery verticals. ET reported on September 28 that Swiggy
was in talks to close another financing round at a $10-billion valuation, double that of its previous round, led by US asset manager Invesco, in what is a likely re-rating exercise stoked by ’s market capitalisation.

Rival Zomato is also looking to tap into ultra-fast commerce, a segment that is attracting abundant investor capital globally. The publicly listed company is
in talks to invest as much as $500 million in online grocery firm Grofers, which is also
rapidly expanding its ultra-fast commerce vertical, ET reported earlier this month. Gurugram-based Grofers may be clocking 80,000-100,000 deliveries per day, according to sources.

The Grofers deal, if it materialises, will be Zomato’s biggest investment in a company so far. The food delivery platform has earmarked $1 billion for investments over the next 1-2 years, the company said while announcing its latest quarterly results.

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Following the surge in online grocery in the aftermath of the coronavirus outbreak, platforms are opening small, quick-delivery warehouses — or dark stores — in densely populated areas from where orders can be serviced quickly.

Mumbai-based Zepto also operates in the quick commerce grocery category. It
recently raised $60 million in a funding round led by US investment fund Glade Brook Capital, which is also an investor in Zomato and US grocery startup Instacart. Zepto is the only startup offering this service as a core offering in a market dominated by bigger players such as Instamart, Dunzo, and Tata group-backed BigBasket.

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