Instacart: Navigating Slower Growth and Crowded Aisles

We initiate STARS coverage on shares of Maplebear Inc. (commonly known as “Instacart”) with a Sell opinion and a 12-month target price of $20, calculated by applying a 10x EV/EBITDA multiple against our 2024 EBITDA estimate of $495 million (-6% Y/Y). As one of the biggest beneficiaries of the pandemic-induced surge in online grocery shopping, Instacart now faces slowing growth during this post-pandemic period, along with macro headwinds, increased competition, and structural challenges for widespread online grocery adoption (e.g., high service fees, quality concerns on perishable items).