Blinkit Leaps Ahead as Zepto's Dark Store Engine Sputters

Zepto’s once-aggressive quick-commerce drive is losing steam. The startup, which became a standout player in India’s instant grocery delivery market, added just 22 dark stores in the past two months, a significant drop from around 300 stores it launched in a single quarter last year, according to a note JPMorgan sent to its clients.

Dark stores — compact, local delivery hubs serving neighborhoods within two to three kilometers — are critical infrastructure for instant grocery delivery services, and this slowdown underscores a broader shift toward careful spending and profitability in the sector.

Zepto has scaled back sharply not just on physical expansion but also on marketing efforts. Sensor Tower data shows Zepto’s paid-ad-driven downloads plummeted by 97% between January and May 2025, dropping from over 250,000 daily downloads to fewer than 10,000. While rivals Blinkit and Swiggy’s Instamart have also trimmed promotional budgets by about 50% and 25%, respectively, Zepto’s deeper cut has widened the gap in user engagement.

Blinkit now enjoys a lead of about 8.2 million weekly active users over Zepto, a steep increase from fewer than one million just eight months ago. Zepto isn’t alone in slowing down, to be sure. Blinkit and Instamart are each expected to open fewer than 150 new stores this quarter, about half their peak rate from late 2024. Still, Zepto’s pullback is notably more drastic.

After accounting for closures and ongoing setups, Zepto currently operates around 1,099 active stores, slightly behind Instamart’s 1,124 and significantly fewer than Blinkit’s roughly 1,400 stores, the investment bank wrote. Looking at the age of each company’s stores, Zepto’s recent slowdown becomes even clearer. Only 6% of Zepto’s locations have opened within the past three month. By contrast, newer stores comprise around 17% of Instamart’s network and about 15% of Blinkit’s, showing these companies remain active, albeit at a more measured pace.

Geographically, Zepto’s growth strategy also seems increasingly conservative. While Blinkit and Instamart have ventured aggressively into smaller towns beyond major cities, Zepto has mostly focused on consolidating its existing urban presence. Blinkit now serves 172 cities, Instamart operates in over 100, and Zepto is present in about 73. While smaller cities can offer lower rents and less competition, they also pose challenges like smaller average orders and higher operational costs per delivery. Several factors are driving the sector-wide moderation.

Capital has become pricier, funding rounds more cautious, and investors increasingly prioritize profitability over rapid growth. Additionally, many major urban markets have become saturated, limiting opportunities for profitable store additions. Zepto’s current slowdown coincides with its decision to defer its planned IPO, originally set for 2025, until at least next year.