Swiggy ventures into retail segment, acquires distribution company LYNK

Swiggy on Thursday announced the acquisition of LYNK Logistics Limited to enter the food and grocery retail market. It said that LYNK, backed by Co-founder and CEO, Shekhar Bhende, will continue to operate as an independent business post-acquisition.

India's food and grocery retail market

The food delivery platform said that India's food and grocery retail market is estimated to be worth more than $570 billion and is expected to grow 8 per cent year-on-year.

Swiggy CEO Sriharsha Majety said that the online food delivery company's experience in supply chain and logistics will help LYNK serve their customers better. 

"I am excited to have the LYNK team join Swiggy. LYNK is uniquely positioned in the retail distribution space with their brand-first, tech-led operating model and has demonstrated  success with multiple FMCG brands. Our experience in supply chain and logistics gives Swiggy the unique opportunity to help LYNK scale up their offerings and empower retailers to serve their customers better," he said in a company statement.

LYNK will leverage Swiggy’s technology 

LYNK is an FMCG retail distribution company founded by Abinav Raja and Shekhar Bhende in 2015. Post-acquisition, the company said that LYNK will leverage Swiggy’s technology and logistics to scale their existing platform.
 
"Over the last few years, we have focused squarely on helping FMCG brands meet their retail ambitions. Given our rapid growth, we believe we are uniquely placed to lead the digitization of retail distribution in India. With Swiggy, we now hope to further accelerate our growth and double down on the tremendous opportunity before us. We are deeply encouraged by our interactions with Swiggy; both companies have an innate builder bias, and I look forward to working together," said Shekhar Bhende, Co-founder, LYNK.

The largest stakeholder in Swiggy, Prosus, last month said that the food delivery platform's losses rose during FY23. In its annual report, Prosus said that its share of losses in Swiggy surged to $180 million, compared to $100 million in FY22. The rise in losses is due to the investments in Instamart, as per the stakeholder. Swiggy's losses for FY23 advanced 80 per cent and stood at about $545 million, higher than the FY22 figure of about $300 million.