Social Security Code Impact Analyzed
The Indian government has announced a new rule affecting companies like Zomato and Swiggy – food delivery apps. Starting November 21, 2025, these companies will have to contribute a small amount to a fund for workers who deliver food and groceries. This contribution is around 1-2% of their yearly sales, but there’s a limit of 5% for what they pay to these workers.
Key Points
- New Code requires aggregators to contribute to worker fund.
- Contribution is 1-2% of annual sales, capped at 5%.
- Cost could be around ₹2-₹2.5 per order for each company.
- Estimate: 0.6-0.65% of sales for food delivery, 0.4-0.45% for quick commerce.
- Companies likely to pass costs onto customers, not absorb them.
- Analysts remain cautious, anticipating stock volatility until clearer rules emerge.
JM Financial, a research firm, estimates the impact. They think Zomato and Swiggy might pay around ₹43 crore and ₹26 crore to this fund yearly. They believe companies will likely pass this extra cost onto customers, instead of absorbing it themselves.
Interestingly, these companies already charge customers fees for things like platform fees and delivery charges. JM Financial believes customers are used to paying these extra fees, so they probably won’t stop ordering food or groceries even if the aggregators add more charges.
Right now, analysts at JM Financial have a “Buy” rating for Zomato and an “Add” rating for Swiggy. They suggest that investors should hold on to their stocks for a while until there’s more information. The stock prices could change a lot during this time of uncertainty.
“Customer behavior reflects a willingness to absorb various platform fees, suggesting continued ordering patterns despite new costs.”
