Uber rival Rapido doubles valuation to $2.3B following Swiggy stake sale

Rapido, a popular ride-hailing platform in India that competes with Uber, has doubled its valuation to $2.3 billion following a secondary share sale by food delivery giant Swiggy. The share sale comes just weeks after Rapido began piloting food deliveries, edging into Swiggy’s core territory.

Swiggy has offloaded its entire 12% stake in Rapido for ₹24 billion (about $270 million) through two separate deals, according to regulatory filings. Around 10% of the stake is being acquired by Prosus for ₹19.68 billion (roughly $222 million), while the remaining stake is being sold to WestBridge Capital for ₹4.31 billion (about $49 million), according to regulatory filings released after Swiggy’s board meeting on Tuesday.

The Dutch investment group Prosus is already a common backer of both Swiggy and Rapido, and is the largest shareholder in Swiggy.

Rapido’s latest share sale pegs the startup at more than twice its $1.1 billion valuation from September 2024, a figure that its CEO confirmed with TechCrunch.

In August, Rapido ventured into food deliveries in Bengaluru through a pilot program operated by its subsidiary Ownly. The pilot marked Rapido’s entry into a sector long dominated by Swiggy and its archrival Zomato. Rapido co-founder and CEO Aravind Sanka confirmed to TechCrunch about the pilot, stating that it initially began in three neighborhoods within the city.

Rapido’s entry into food delivery came over three years after Swiggy backed the startup in a $180 million funding round in April 2022.

Rapido also partnered with Swiggy as a last-mile delivery provider, helping fulfill food orders on the platform. Swiggy’s early partnership gave Rapido a window into customer demand patterns and the operational challenges faced by restaurants on the platform, including the commissions required to receive orders, a source familiar with the matter told TechCrunch.

Swiggy hinted earlier this year that it might sell its stake in Rapido. In a July letter to shareholders, Swiggy stated it was reassessing its stake in Rapido due to a potential conflict of interest, as the ride-hailing company prepared to enter the food-delivery market. Swiggy co-founder and CEO Sriharsha Majety also mentioned during a July earnings call that the company “even had some conversations around a potential collaboration in food delivery with Rapido.”

“Unfortunately, that didn’t materialize, and Rapido decided to enter the business,” Majety told investors on the call.

It’s still too early to gauge whether Rapido’s emerging food delivery business will affect incumbents like Swiggy and Zomato.

The entry was expected to pressure existing players to lower their commissions to retain restaurant partners. However, a recent goods and services tax (GST) update by the Indian government may limit pricing flexibility, with a flat 18% tax now levied on online food deliveries, making cost competitiveness a less effective edge.

That said, Rapido has already been a strong contender in India’s ride-hailing market. Uber CEO Dara Khosrowshahi recently described the startup as Uber’s biggest rival in India — not the SoftBank-backed incumbent, Ola.

As Rapido creeps into food delivery, Swiggy continues to build out its instant-commerce business, a competitive industry that offers quick delivery of groceries and other items in less than an hour.

Swiggy announced the incorporation of a step-down subsidiary for its fast-growing quick commerce arm Instamart. The move could help it strengthen its position in India’s competitive quick commerce market, which includes players such as Zomato’s Blinkit, Flipkart, and Amazon. The structure may also pave the way for a potential spin-off or separate fundraising for Instamart in the future.

Instamart has emerged as Swiggy’s fastest-growing business in recent months, with its gross order value surging 82% to ₹146.83 billion ($1.7 billion) in FY25 (PDF) — nearly a third of the company’s total B2C orders. Instamart’s revenue also more than doubled to ₹22.52 billion ($254 million), outpacing the core food delivery segment, which grew 16.4% in order value and 83% in revenue.