Swiggy, one of India’s food delivery giants, is set to make headlines with its decision to sell its entire stake in urban mobility startup Rapido for up to Rs 2,500 crore. This marked move not only underscores the intensifying competition in the food delivery landscape but also reflects Swiggy’s strategic recalibration as it strives for profitability and dominance in a rapidly evolving sector.
A Strategic Crossroads
Swiggy’s investment in Rapido began nearly three years ago when it acquired a 12% minority stake. At the time, Rapido was valued at around Rs 6,300 crore. Since then, Rapido has transformed into the largest mobility platform in India by ride volume, recently achieving unicorn status and securing a valuation north of Rs 9,300 crore.
Key Developments Behind the Sale
Rapido’s recent entry into food delivery with a Bengaluru pilot has sharply altered the competitive equation. This new foray positions Rapido as a direct competitor to Swiggy, raising concerns over conflict of interest.
Swiggy acknowledged this potential conflict in its letter to shareholders, stating its 12% minority stake, which has appreciated significantly, is now under active re-evaluation due to these developments.
According to people familiar with the matter, Swiggy aims to fetch up to Rs 2,500 crore (around $300 million) from the stake sale, which would represent a complete exit from Rapido.
What’s Driving Swiggy’s Move
Market Dynamics: The Indian food delivery sector has seen intense rivalry, with Rapido now joining the fray alongside giants like Zomato, Amazon, and ONDC.
Shareholder Priorities: Swiggy’s IPO journey and imperative to sharpen focus on core verticals, especially as it faces widening losses amid heavy investments in quick commerce and new customer acquisition.
Financial Optimization: Liquidity from the Rapido stake sale will bolster Swiggy's cash reserves, allowing it to reinvest in its mainline businesses and pave a pathway to profitability.
Financial and Industry Context
Swiggy reported a net loss of Rs 1,197 crore for the April-June 2025 quarter, widening from both the previous quarter and the same period last year, even as it saw revenue jump by 54% year-on-year to Rs 4,961 crore.
Operating costs, marketing spend, and expansion into new cities have fueled these losses, with rapid outlays for its quick commerce arm, Instamart, and other verticals.
Despite the losses, Swiggy’s management remains upbeat about long-term growth, signaling confidence that margins will improve in the next two to four quarters.
Implications and Industry Reactions
Swiggy’s decision is widely seen as a strategic reset, enabling it to sidestep potential competitive conflicts while monetizing an investment that has delivered significant returns.
The food delivery segment in India is expected to witness heightened competitive intensity, with Rapido leveraging its mobility expertise and zero-commission promise to woo new restaurant partners and consumers.
Key Highlights of the Announcement
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Swiggy plans to sell its full 12% stake in Rapido for up to Rs 2,500 crore.
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Rapido’s food delivery ambitions pose a conflict of interest with Swiggy’s core segment.
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Liquidity from the sale will aid Swiggy as it seeks profitability amid consecutive quarterly losses.
The move underscores the shifting landscape in India’s food-tech and urban mobility sectors.
What’s Next for Swiggy
As Swiggy shores up its resources, analysts expect the company to double down on its food delivery and quick-commerce operations while steadily progressing on its path to profitability.
All eyes are now on how the liquidity infusion and reduced exposure to competitive conflicts will fortify Swiggy’s strategic ambitions in a market where agility and capital allocation will decide the winners.
Source: Moneycontrol, NDTV Profit, Times of India, Economic Times, Fortune India, Swiggy Q1FY26 shareholder letter, as of August 6, 2025.
