Rapido, India’s fast-growing ride-hailing startup and Uber’s biggest local rival, has doubled its valuation to $2.3 billion following a major secondary share sale. The jump comes as food delivery giant Swiggy divested its entire 12% stake in Rapido for ₹24 billion (about $270 million), according to fresh regulatory filings.
The sale was split between two investors: Dutch tech investor Prosus, which picked up around 10% for ₹19.68 billion ($222 million), and WestBridge Capital, which acquired the remaining 2% for ₹4.31 billion ($49 million). Prosus is already the largest shareholder in Swiggy, making it a common backer of both companies.
This latest transaction values Rapido at more than twice its $1.1 billion valuation from September 2024, underscoring investor confidence in its growing ambitions.
Rapido Steps Into Food Delivery
In August, Rapido began piloting food delivery in Bengaluru through its subsidiary Ownly, marking a direct challenge to incumbents Swiggy and Zomato. The pilot initially launched in three neighborhoods.
The move came three years after Swiggy itself invested $180 million in Rapido’s April 2022 funding round. Since then, Rapido has also served as a last-mile delivery partner for Swiggy, giving it insights into customer behavior, restaurant pain points, and the economics of delivery commissions.
Swiggy, however, hinted earlier this year that its stake in Rapido was under review due to a “conflict of interest.” In a July earnings call, CEO Sriharsha Majety said Swiggy had even discussed a possible food delivery collaboration with Rapido, but “unfortunately, that didn’t materialize, and Rapido decided to enter the business.”
Competitive Landscape
It’s still early to measure Rapido’s impact on India’s food delivery market. While its entry could pressure Swiggy and Zomato to lower commissions, a new 18% GST on online food deliveries has reduced room for aggressive pricing.
Meanwhile, Rapido remains a strong contender in its core business. Uber CEO Dara Khosrowshahi recently named Rapido as Uber’s biggest rival in India, above Ola.
Swiggy’s Bet on Quick Commerce
As Rapido tests food delivery, Swiggy is doubling down on Instamart, its quick commerce arm that promises grocery and essentials delivery in under an hour.
Swiggy recently incorporated a step-down subsidiary for Instamart, a move analysts say could pave the way for a spin-off or separate fundraising. The business has quickly become a growth engine:
- Instamart’s gross order value surged 82% to ₹146.83 billion ($1.7 billion) in FY25, nearly a third of Swiggy’s total B2C orders.
- Revenue more than doubled to ₹22.52 billion ($254 million), outpacing Swiggy’s core food delivery unit, which grew 16.4% in order value and 83% in revenue.
With Rapido branching out into food delivery and Swiggy strengthening its position in quick commerce, the battle lines in India’s hyper-competitive on-demand economy are shifting once again.
