Swiggy has earmarked $700 million for its Instamart service, amid heightened investor interest and growing competition in the instant grocery delivery segment, co-founder and chief executive Sriharsha Majety said.

Instamart launched in August last year as Swiggy’s quick commerce vertical, is set to reach an annualised GMV run rate of $1 billion in the next three quarters, the company said.

“It is not a dated commitment where we are going to deploy this in the next 12 months or 18 months. We think that it is the size of ammunition that we need to deploy to be able to do justice to this category,” he said.

The delivery platform has more than one million grocery orders per week and runs 150 dark stores across 18 cities. Over the next few months, it will add 100 more of these so-called dark stores.

“It is an exciting category and our commitment to invest is also a function of that. Every time there is a new category that is starting to explode or open up whether globally or locally there’s always going to be interesting and there will be some funding happening along the way,” Majety said about the flood of investments in the ultra-fast delivery space.

“The platform benefit is a clear one. Our user acquisition costs are much lower than any standalone company. That’s trying to acquire consumers afresh. As you have seen with any multi-category app where users transacting on two categories actually grow their business in both the categories when there’s more engagement, the whole flywheel of multi-category commerce is a real one”.

Instamart emerged from the learnings of Swiggy Stores, a hyperlocal delivery marketplace for groceries and other essentials that shut earlier this year.

Majety said that the company will continue to strengthen its multi-category convenience play.