Rapido food delivery may be new on the block, but it’s unlikely to shake up the strong grip Zomato and Swiggy have on India’s food delivery business, according to analysts at Bernstein.
In a report released today, Bernstein said the operational demands, market depth, and massive investments from Zomato and Swiggy make it tough for new players to scale fast. The numbers say it all: Zomato controls 54% of the market, Swiggy has the rest, and together they’ve invested over $3 billion building their empires.
So, what does this mean for you?
If you’re a budget-conscious consumer or a small local eatery, Rapido’s “Ownly” platform might sound tempting. It’s focused on meals under ₹150 and charges restaurants only 8–15% commission—much lower than the 18–20% by Zomato or Swiggy. They’re even offering zero-commission for some meals during the Bengaluru pilot.
But for most users? The apps you already use aren’t going anywhere. Rapido’s model may widen the market at the fringes, but don’t expect it to deliver a knockout punch just yet.
Low-cost pitch, high uphill climb
Rapido has a huge bike fleet—over 3 million—and plans to tap Tier 2 and 3 cities with affordable meals and no packaging or platform fees. But the reality? Food delivery isn’t cheap.
Bernstein estimates delivery costs in India at ₹50–60 per order, and average order value around ₹400–500. Rapido’s slim margins won’t leave much room for reinvestment or expansion. Sound familiar? Amazon, Ola, and ONDC tried this too—and quietly exited.
As one analyst put it: “The economics just don’t add up unless you’re already big.”
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Still, there’s a plot twist
Rapido’s model could help bring small eateries online for the first time. If successful, it might grow the pie instead of stealing slices from Zomato or Swiggy.
That said, Bernstein warns it’s a long road. Rapido plans to bear initial delivery costs and later charge restaurants a flat subscription. But for now, it’s burning cash just to keep meals cheap.
Who’s winning now?
Zomato, which trades at ₹257.68 (up 0.78%), remains Bernstein’s top pick with a ₹280 target. Swiggy, down 2% at ₹355.05, also got an “outperform” rating with a ₹435 target.
Bernstein’s bottom line?
“Rapido’s launch introduces an alternative model, but the structural advantages of incumbents remain intact.”
In short: Rapido is trying to break in through the basement, while Zomato and Swiggy are already chilling in the penthouse.
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