India’s on-demand market is witnessing major realignments as Swiggy, a leading player in food delivery and quick commerce, has sold its entire 12% stake in bike-taxi startup Rapido. The sale, valued at approximately ₹2,399 crore ($270 million), marks Swiggy’s exit from Rapido ahead of the latter’s planned funding round and reflects shifting alliances in the highly competitive gig economy.
Why Did Swiggy Exit Rapido?
Swiggy acquired its stake in Rapido for about ₹1,020 crore in 2022, anticipating synergies between food deliveries and bike taxi logistics. However, in recent months, Rapido launched “Ownly,” a food delivery service that directly competes with Swiggy, especially in India’s smaller cities by offering lower restaurant commissions. This development introduced a clear conflict of interest for Swiggy, prompting the decision to divest and focus on its core food delivery and quick commerce business.
Details of the Transaction
The board of Swiggy approved the sale on September 23, 2025, transferring its shares in Rapido to MIH Investments One B.V. (Netherlands-based) for ₹1,968 crore and to Setu AIF Trust (managed by WestBridge Capital) for ₹431.5 crore. These deals value Rapido at roughly $2.37 billion—more than double its 2024 valuation.
Strategic Focus: Instamart Restructuring
Alongside the Rapido sale, Swiggy is restructuring its quick-commerce business, Instamart, amid stiff competition from Zomato’s Blinkit and Zepto. Proceeds from the stake sale are expected to bolster Swiggy’s cash reserves, giving the company more room to invest in Instamart’s growth without raising fresh capital or turning to debt. Instamart will be spun off into a separate subsidiary to enhance operational efficiency and financial flexibility.
Impact and Market Reaction
Market watchers have largely welcomed Swiggy’s move, noting it aligns with the company’s goal to sharpen core business strategy and improve financial discipline. While Swiggy’s stock dropped slightly after the announcement—partly on profit-taking—the deal was seen as a positive for creating a more focused corporate structure. Rapido, meanwhile, appears well-placed to close a substantial new funding round, using the capital for aggressive expansion against rivals like Ola and Uber, particularly in Tier 2 and 3 cities.
Industry Outlook
Swiggy’s exit from Rapido underlines the growing complexities in India’s on-demand services market, where overlapping interests and new competitors drive fast strategic pivots. For both companies, the next phase will center on differentiation, operational scale, and capturing growth in evolving consumer segments.
