Zomato vs Swiggy: Buy Before Q2 FY26 Results?

Zomato vs Swiggy: Which Food Delivery Stock to Buy Before Q2 FY26 Results?

New-age tech stocks in India's food delivery and quick commerce sectors have endured a turbulent ride in 2025, battered by competition, slowing growth, and economic pressures. However, analysts see a turning point, with food delivery (FD) poised for 20%+ acceleration over the next 2-4 quarters, boosted by festive surges and GST reforms easing operations. Quick commerce (QC) is stabilizing as new players falter, dark store expansions moderate, and discounting eases, potentially driving non-metro adoption. As Zomato Q2 FY26 results loom on October 16, 2025, and Swiggy's follow soon after, investors must decide which stock offers better entry ahead of these earnings.

Zomato (now Eternal Ltd.) is projected to showcase sequential EBITDA growth of 120% to ₹252.5 crore and net profit to ₹78.4 crore, per JM Financial, with strong showings in FD and Blinkit. Swiggy, meanwhile, may narrow losses but faces QC headwinds, with EBITDA at ₹840 crore and PAT at ₹1,094.9 crore. Brokerages like Motilal Oswal (MOFSL) and JM Financial lean toward Zomato for its momentum, while technicals favor it for a potential ₹500 target.

Zomato shares have risen 28% YTD, contrasting Swiggy's 19% decline. With both reporting amid a bullish small-cap rally, this comparison dissects previews, analyst calls, and technicals to guide your buy decision.

Zomato Q2 FY26 Results Preview: Sequential Strength in Focus

Zomato, rebranded as Eternal Ltd., will unveil Q2 FY26 results on October 16, 2025, with an earnings call at 5 PM IST. JM Financial anticipates consolidated EBITDA surging 120% QoQ to ₹252.5 crore and net profit to ₹78.4 crore from ₹25 crore in Q1, driven by FD stability and Blinkit's scaling.

Food Delivery (Zomato): Expect NOV growth of ~6% QoQ (+15% YoY), take-rates at 25.6%, and contribution margin at 10.1%. Adjusted EBITDA margin holds flat at ~5%, reflecting steady monetization amid 19% YoY GOV growth, per MOFSL. Festive demand and GST reforms are tailwinds, potentially accelerating to 20%+ in H2 FY26.

Blinkit (QC): NOV to grow ~28% QoQ (+139% YoY), with take-rates leaping to 56% from 23.5%, contribution margin at 4.4%, and adjusted EBITDA improving to -0.8%. Store additions to 2,000 by December 2025 and easing competition bolster margins, targeting break-even by Q3 FY26.

Overall, revenue is eyed at 68% YoY growth, with GOV for FD and QC at 19% and 142% YoY, take-rates 21.5% and 18.7%. Zomato's diversified portfolio- including Hyperpure and District-supports resilience, with analysts forecasting 25%+ annual growth.

Swiggy Q2 FY26 Results Preview: Narrowing Losses Amid QC Pressures

Swiggy's Q2 FY26 earnings, expected in late October 2025, project narrowed losses but persistent red ink. JM Financial estimates EBITDA at ₹840 crore (from ₹953.8 crore in Q1) and PAT at ₹1,094.9 crore (from ₹1,196.8 crore), reflecting modest FD gains offset by QC investments.

Food Delivery: GOV ~6% QoQ (+19% YoY), take-rates 22.4%, adjusted EBITDA margin 2.8% (up from 2.4%). MOFSL forecasts 20% YoY GOV with 22.5% take-rates, benefiting from festive boosts but facing Zomato's dominance.

Instamart (QC): GOV ~23% QoQ (+106% YoY), contribution margin -2.8%, adjusted EBITDA -11.8%. Expansion to 52 new stores and 14.3% take-rates signal progress, but absolute losses remain sticky, targeting break-even by Q3 FY26.

Revenue growth at 30% YoY to ₹3,601 crore is solid, but EBITDA positivity by Q3 FY26 hinges on cost controls. Swiggy's Bolt (10-min delivery) at 5% of FD orders shows promise, yet QC margins lag Blinkit's.

Analyst Recommendations: Zomato Edges Out Swiggy

Brokerages favor Zomato pre-results. JM Financial's 'Buy' on Eternal targets ₹400 (Sept 2026), citing 120% EBITDA jump and Blinkit's scaling, versus 'Reduce' on Swiggy at ₹440, flagging QC losses.

MOFSL's 'Buy' on both: Zomato at ₹420, Swiggy at ₹550, highlighting GOV growth (19% FD, 142% QC for Zomato; 20% FD, 106% QC for Swiggy). UBS echoes 'Buy' on Swiggy at ₹515 (19.5% upside), but Zomato's 24/28 'Buy' ratings (vs Swiggy's 9/14) signal stronger consensus.

Zomato's YTD +28% vs Swiggy's -19% reflects market preference for its profitability trajectory. ICICI Securities prefers Zomato for 20%+ FD growth, while Swiggy's B2B push (Assure) competes with Hyperpure but trails in execution.

Technical Analysis: Zomato's Bullish Momentum vs Swiggy's Volatility

Technicals tilt toward Zomato. Anshul Jain of Lakshmishree Investments highlights Eternal's breakout above ₹300 on weekly charts, projecting ₹500 with strong RSI (65) and relative strength. Swiggy's sentiment-driven swings around earnings lack Zomato's firm structure.

Zomato's golden cross (50DMA > 200DMA) confirms uptrend, with support at ₹280 and resistance at ₹320. Swiggy hovers near 52-week low (₹306.95), down 50% from ₹617.30 high, with RSI at 40 signaling oversold but volatile potential.

For traders, Zomato offers pre-results entry at ₹290-₹300, targeting 15% upside. Swiggy's -43% correction from peaks suggests value at ₹350, but Zomato's momentum makes it the safer bet.

Sector Tailwinds: FD and QC Recovery in 2025

FD growth is rebounding to 20%+ quarterly, per analysts, fueled by festive orders (up 30% YoY) and GST reforms reducing compliance costs. QC stabilizes as discounting eases (from 25% to 15%) and non-metro penetration rises 40%, with dark stores at 1,000+ for leaders.

Zomato's Blinkit leads with 28% QoQ NOV vs Swiggy Instamart's 23%, benefiting from 56% take-rates. Both eye profitability by Q3 FY26, but Zomato's 5% EBITDA margin vs Swiggy's -11.8% in QC gives it edge.

Market size: FD at ₹50,000 crore, QC at ₹10,000 crore by FY26-end, per Redseer. GST cuts on QC to 5% from 18% boost adoption, favoring incumbents like Zomato with 55% share.

Risks and Challenges: What Could Derail the Rally?

Zomato risks include QC margin compression from Flipkart Minutes and Amazon Now, potentially delaying break-even. Swiggy faces steeper losses if Instamart's 106% YoY GOV fails to monetize, with 14.3% take-rates lagging.

Macro risks: Inflation curbing discretionary spends, regulatory scrutiny on dark stores. Zomato's Hyperpure B2B competes with Swiggy's Assure, but execution lags could pressure shares 10-15% post-results if misses occur.

Both trade at 30-35x FY26 P/E, vulnerable to rate hikes. Diversify with dine-out plays like Jubilant Foodworks for balanced exposure.

Investment Verdict: Buy Zomato Ahead of Q2 Results

Zomato emerges as the preferred buy pre-Q2 FY26, with 'Buy' consensus, ₹400-₹420 targets (25-35% upside), and technical strength targeting ₹500. Swiggy's 'Buy' ratings (₹440-₹550) offer value, but QC losses and -19% YTD lag Zomato's +28%.

For aggressive investors, allocate 60% Zomato for momentum; conservative ones 40% Swiggy for recovery potential. Monitor earnings for GOV/take-rate beats-Zomato's likely outperformance could spark 10% rally.

In 2025's volatile tech landscape, Zomato's execution edges it as the smarter bet for growth-oriented portfolios.