SynopsisSwiggy shares plunged as much as 6% after the food delivery and quick commerce company reported its June-quarter results. While the consolidated net loss narrowed year-on-year, investors remained cautious over profitability and margin pressures. Brokerages stayed largely positive on the stock, with most retaining their 'Buy' ratings, citing long-term growth potential despite near-term challenges.Shares of food delivery and quick commerce major Swiggy tanked as much as 6% to an intraday low of Rs 280 on the BSE on Friday after it reported a consolidated net loss of Rs 791 crore for the first quarter of FY27, marking a nearly 34% year-on-year (YoY) decline from the Rs 1,197 crore net loss reported in the year-ago period.The company’s revenue from operations, meanwhile, increased more than 37% YoY to Rs 6,812 crore during the April–June quarter of FY27, from Rs 4,961 crore in the corresponding quarter of the previous financial year.Instamart, the company’s quick commerce arm, also saw its losses narrow to Rs 651 crore in Q1 FY27 from Rs 797 crore in the year-ago period. Its revenue from operations, meanwhile, surged nearly 53% YoY to Rs 1,232 crore. Instamart’s Gross Order Value (GOV) rose nearly 40% YoY to Rs 7,907 crore, while its contribution margin improved by 440 basis points to 0.2%.Also read: Company in a strong position, competition poses no threat to growth: SwiggySwiggy shares: Buy, sell or hold?Nomura maintained its 'Buy' rating on Swiggy but cut its target price to Rs 435, implying an upside of about 47%. The brokerage said Instamart is prioritising growth over margins and remains well-funded to navigate near-term headwinds. Adjusted EBITDA margin declined 20 basis points to 3.1%, mainly due to seasonal investments in rider availability and annual salary hikes, while monthly transacting users rose 4.9% QoQ to 19.2 million. Nomura expects Swiggy's food delivery business to deliver 17–18% YoY GOV growth with adjusted EBITDA margins of 3.2–4.4% over FY27–28.Motilal Oswal reiterated its 'Buy' rating with a target price of Rs 350, implying an upside of about 18%. The brokerage largely retained its estimates, citing steady execution in the food delivery business with expanding margins and noting that Instamart has largely addressed concerns around contribution margins.It expects the focus to shift to sustaining GOV growth through higher monthly transacting users, stronger customer retention and better monetisation, while moving closer to EBITDA profitability. Motilal continues to see long-term value in Swiggy's food delivery franchise and brand, but believes a clear path to quick commerce EBITDA profitability will be crucial for a meaningful re-rating.Nuvama has maintained a 'Buy' rating on Swiggy with a target price of Rs 444. The brokerage said the management follows a conservative accounting approach, with no capitalization of employee costs or new-store ramp-up expenses, and no securitization of payables. It noted that quarterly margins were impacted by seasonal cost pressures, including annual salary revisions, minimum wage hikes for dark store operations, and higher delivery partner costs. Nuvama expects the profitability of the food delivery business to increasingly offset cash burn in the quick commerce segment over the coming quarters.Read more: Swiggy Instamart ropes in ex-Myntra boss Nandita Sinha as q-comm battle heats upElara Capital has downgraded Swiggy to Accumulate from Buy and trimmed its target price to Rs 350 from Rs 360. The brokerage noted that food delivery GOV grew 17.4% YoY, supported by healthy growth in monthly transacting users. However, the contribution margin in the food delivery business softened sequentially despite stronger take rates. Elara said the downgrade reflects delayed profitability and a longer-than-expected timeline for margin convergence with peers.Swiggy Q1 management commentary“In a period where quick commerce competition has only intensified, we prioritised improving unit economics over fleeting headline growth. Our efforts over the last few quarters to reset our user base, economics and experience have together made the business much stronger and increased the staying power,” said Sriharsha Majety, founder and group CEO, Swiggy.Instamart’s contribution margin for the quarter stood at -0.2% of GOV, improving by 4.4 percentage points from a year earlier, while adjusted EBITDA losses narrowed to Rs 778 crore from Rs 896 crore in the year-ago period.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. 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