The rapid use of Technology has unlocked the potential to tap various income segments and to streamline the logistic process of food delivery from restaurants to their home or any place the customer desires.
Apart from Zomato & Swiggy, there were players like Dunzo, Uber Eats & Others who lost their way or got acquired by other players. Currently, Zomato & Swiggy dominate the Indian food delivery industry. Rapido which made its name in the ride-sharing application is in plans to enter the food delivery business as per various sources. Can it disrupt this this duopoly? Let’s take a look into this.
Price Action
With a market capitalization of Rs. 1,96,722.40 Crores, the shares of Zomato Limited closed at Rs. 203.85 which is up by 1.22 percent from its previous closing price of Rs. 201.40 apiece.
With a market capitalization of Rs. 80,874.28 Crores, the shares of Swiggy Limited closed at Rs. 354.30 which is up by 0.28 percent from its previous closing price of Rs. 353.30 apiece.
Food Delivery Business domination
India’s online food delivery market is experiencing rapid growth, which is driven by factors such as urbanization, changes in lifestyles, and technological advancements. The market is projected to grow significantly, with estimates suggesting a size of $43.47 billion in 2024 and reaching $265.12 billion by 2033, with a CAGR of 22.25 percent from 2025 to 2033 as per sources.
Key players like Swiggy and Zomato dominate the market with a share of 43 and 57 percent as of Q2FY25 as per various sources, while offering a wide range of cuisines and leveraging logistics infrastructure.
Can Rapido disrupt the Food Delivery space?
Rapido, which is a ride-hailing app that has grown to become the second-largest player in India, is in discussions to enter the food delivery market as per sources.
The company, which already provides delivery services using its two-wheeler fleet, is meeting with restaurateurs to develop a business model as per media outlets. The company handles around 3.2 to 3.5 million rides daily and is expanding to 500 cities across India by 2025.
This move comes as Rapido has already raised significant funds, including ~$30 million in February 2025 and ~$200 million last year, bringing its valuation to ~$1.1 billion.
Currently, the food delivery industry is facing growth slowdowns and disputes regarding commissions, Rapido’s foray into this space could further disrupt the market.
Recent Stock Correction
Zomato stock has delivered a 28.47 percent return and compared to the Nifty Index it has outperformed. From its 52-week high of Rs. 304.70, it is trading at a discount of ~33 percent.
Swiggy was listed in November 2024 and initially, it surged and touched its 52-week high of Rs. 617.30 and has corrected by ~43 percent from its high. The stock has underperformed from the listing period.
Business Mix
Zomato earns 38.33 percent from Food Delivery, followed by 30.91 percent from Hyperpure supply, 25.88 percent from Quick Commerce, 4.79 percent from Going Out, and the remaining 0.07 percent from Others for the December 2024 quarter.
Likewise, Swiggy earns 40.97 percent from Food Delivery, 1.66 percent from Out of Home Consumption, 14.42 percent from Quick Commerce, 42.36 percent from Supply Chain & Distribution, and the remaining 0.05 percent from Others in the Q3FY25 quarter.
Future Plans
Zomato and Swiggy are expanding their quick commerce platforms. Zomato is targeting to open 2,000 Blinkit dark stores by December 2025, while Swiggy plans to double Instamart’s store count to over 1,045 by March 2025.
About the Company
Zomato, now rebranded as Eternal includes Zomato, Blinkit, District, and Hyperpure. It aims for significant growth with Blinkit leading in quick commerce.
Swiggy was founded in 2014 and is a leading Indian convenience platform offering food delivery, grocery services via Instamart, and logistics through Genie.
Financials
Zomato’s revenue from operations increased by 64.38 percent year on year from Rs. 3,288 Crores in Q3FY24 to Rs. 5,405 Crores in Q3FY25, accompanied by a profit of Rs. 138 Crores to Rs. 59 Crores.
Swiggy’s revenue from operations increased by 30.96 percent year on year from Rs. 3,049 Crores in Q3FY24 to Rs. 3,993 Crores in Q3FY25, accompanied by a loss of Rs. 574 Crores to a loss of Rs. 799 Crores.
Written by Santhosh S
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