The discount war in India’s quick-commerce sector may be cooling. Discounts across major platforms have fallen to 19-20 per cent over the past three to four months from the peak it hit earlier this year.
Amazon Now was among the most aggressive players during the price war in early 2026, said experts, pointing to the company raising discounts from 26 per cent in November 2025 to 57 per cent two months later. This even as Flipkart Minutes and incumbent platforms stepped up discounts by 200-300 basis points across categories.
But just as the latter have found a firmer economic footing, the competitive bar seems to be rising. Larger e-commerce platforms are building 400-600 dark stores each and could scale to 1,200-1,500 over the next 12-18 months, according to UBS.
The prize is also getting bigger. Quick commerce has expanded to more than 100 towns, prompting the financial-services firm to raise its estimate of the industry’s total addressable market to $59 billion by FY30 from $34 billion earlier. It expects quick commerce to capture roughly half of incremental online retail growth.
The expansion is also blurring category boundaries. Experts said dark stores are increasingly fulfilling purchases of electronics, personal care, apparel, and other non-grocery products traditionally sold through conventional e-commerce.
The improving economics are giving established players more room to respond.
Blinkit leads the market ahead of Swiggy’s Instamart and Zepto. The companies have considerable firepower to fund expansion and perhaps withstand another bout of aggressive spending, too, said experts. They pointed to the huge cash reserves of the three players (nearly ₹18,000 crore each for Blinkit and Instamart, and about ₹7,000 crore with Zepto).
Operating economics are improving, too. Blinkit’s Q1 performance showed rapid net order value growth alongside a positive adjusted EBITDA margin, according to UBS.
Instamart reached a contribution-margin break-even in May, with its quarterly contribution margin improving 160 basis points sequentially to negative 0.2 per cent.
Zepto cut discounts and removed more than four million unprofitable users as it pushed towards contribution-margin break-even, experts said. The company increased discounts again in early July as it pivoted back towards growth.
Better unit economics, however, don’t necessarily translate into the margins once expected from the business.
UBS has cut its steady-state margin expectations by 250-300 basis points as non-metro expansion, lower-margin non-grocery categories, and sustained multi-player competition alter industry economics.
As headline discounts stabilise, platforms are increasingly turning to advertising monetisation, brand-funded promotions, and platform and delivery fees. UBS expects differentiation to increasingly depend on store productivity, availability, assortment, fulfilment efficiency, delivery speed, and customer retention.
A similar push is playing out in food delivery, where more than 70 per cent of users transact less than once a month.
Zomato and Swiggy Food Delivery are targeting this opportunity through lower-priced baskets, reduced restaurant commissions, simplified fees, tighter delivery radii, and greater batching. Early evidence cited by UBS from one initiative showed two-thirds of customers were either new or previously dormant.
Recent sector results also showed 20 per cent net order value growth and the addition of 1.8 million transacting users.
The next phase, experts said, will be less about who can open the most dark stores or offer the deepest discounts and more about who can extract the best economics from them.
With a $59 billion market at stake, substantial cash on balance sheets, and new competitors willing to spend, the land grab isn’t over, but experts say the contest is increasingly shifting from buying growth to executing it.
Published on August 19, 2026
