India’s fast-paced trading market is booming, with demand doubling for some players. But the push for fast delivery by Flipkart and Amazon raises the stakes in an already crowded space where profitability remains under pressure.
One of India’s largest e-commerce players, Flipkart entered e-commerce later than local rivals like Blinkit, Swiggy and Zepto. But TechCrunch reported this week that it has more than 800 dark stores (distribution centers for online purchases) and plans to double that number by the end of 2026, according to UBS.
The expansion comes as India’s fast-paced trading sector enters a more intense phase of competition. The tension is also reflected in recent developments Co-founder departure at Swiggy this week as companies reassess strategy amid increased competition and costs.
A company owned by Walmart made his debut In August 2024, Flipkart is offering up to 10 minutes of delivery across categories in fast trading with Minutes. Since then, the sector has expanded rapidly. More than 6,000 dark shops are currently operating, leading to significant overlap and increased competition among players in major cities, Bernstein said in a report earlier this week.
Outside the big cities
According to Bernstein, Flipkart’s network in India remains smaller than market leader Blinkit, which has more than 2,200 dark stores. However, Flipkart is betting on expanding beyond major cities to accelerate growth. This is different from Blinkit It plans to reach 3,000 dark stores by 2027 while focusing on the top 10 cities.
“Flipkart has this Walmart DNA,” said Satish Meena, founder of Gurugram-based consumer insights firm Datum Intelligence. “Walmart’s DNA has always been about expanding the general-address opportunity to dominate by expanding the market.”
A source familiar with the matter told TechCrunch that Flipkart is already seeing traction outside major cities, with 25-30% of its fast-commerce orders now coming from smaller cities. Orders per dark store were also up about 25% month-over-month, the person said.
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However, growth in fast-paced commerce has been concentrated in larger cities. More demand continues to be driven by big cities, where higher population densities support faster delivery and better use of dark stores, Bernstein said, even as expansion into smaller cities gathers pace.
This dynamic also lays the foundation for profitability. India’s top eight cities, according to Bernstein, have more than 3,800 dark shops run by the five largest players, of which about 3,600 have the potential to be profitable.
“Metro markets are clearly better in terms of yield ratios, better in terms of profitability because of higher throughput,” said Karan Taurani, executive vice president at London-headquartered investment banking and brokerage firm Elara Capital. “That business is about higher throughput, and for now that’s mostly coming from metro markets.”
Still, some analysts see a longer-term opportunity outside the big cities. “Non-metros (smaller cities) can deliver growth if companies move beyond grocery and offer a wider range of products at a higher rate,” said Datum’s Satish Meena. “Flipkart is betting on it.”
However, it will take time to go beyond the limits of the big cities. Flash trading is currently available in about 125 cities, with dark shops typically taking six to 12 months to reach maturity and profitability, said Aditya Soman, senior research analyst at CLSA, a Hong Kong-based brokerage. Many of the new stores in smaller towns are still under development, he added.
Amazon, which entered Soon after the debut of Flipkart in late 2024, India’s e-commerce market is also increasing its presence. The e-commerce giant has opened 450-500 dark stores to date, with around 330-370 currently operating, according to UBS, as it looks to capitalize on growing demand for faster deliveries.
Putting pressure on officials
To compete, Flipkart relies not only on dark store expansion but also on aggressive pricing. The company is offering some of the highest discounts in the segment — about 23-24% across categories, based on a sample basket analyzed by Jefferies last month — trying to attract users in a market where price and convenience remain key drivers of demand.
The pressure of such strategies works. Brokerage firm JM Financial recently warned that Swiggy’s fast trading business “Growth versus income has stalled” and with the risks of destroying shareholder value, a buyout by a larger, better capitalized player may be the best outcome for investors.
Shares of Eternal, the owner of Blinkit, are down nearly 15% this year, while Swiggy is down more than 29%. is about to go public later this year on Indian stock exchanges.
The entry and expansion of big players like Flipkart and Amazon are reshaping the competitive landscape. Ankur Bisen, senior partner at retail consultancy Technopak Advisors, said: “Fleece trading is no longer in its infancy – it has become a big players’ game.”
He added that the sector’s economics and limited differentiation could eventually lead to consolidation as companies compete for the same set of customers in a heavily discounted market.
Amazon, Flipkart and Swiggy did not respond to requests for comment. Eternal declined to comment, while Zepto said it could not comment due to a silent period following its IPO.
