Swiggy shares hit record low after dropping sixteen percent

Shares of Swiggy dropped by 16.4 percent to reach 176.70 rupees, setting a new record low for the company. This sharp fall comes as widening losses in the quick-commerce segment raise worries about high cash burn and the path to profitability. Market experts are also questioning the company's business choices and execution after its entry into the stock market. Furthermore, a brokerage has pointed out doubts regarding Swiggy's separate app created for value-oriented food delivery.

Context

Quick-commerce companies spend large amounts of money on rapid delivery networks and dark stores to capture market share quickly. When companies make losses in these fast-growing segments, stock markets often react with concern over how long they can sustain high spending before making a profit.