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Swiggy Reconsiders Rapido Investment Amid Conflict of Interest Concerns

• ByStartupStory     |    August 1, 2025

Food delivery giant Swiggy has announced that it is actively re-evaluating its investment in ride-hailing firm Rapido, citing a potential conflict of interest as the relationship between the two companies evolves. The update was disclosed in a stock exchange filing and signals a possible strategic shift in Swiggy’s portfolio.

Swiggy currently holds a 12% stake in Rapido, a shareholding that has appreciated significantly since its original investment. Swiggy had led a $180 Mn funding round in the mobility startup in April 2022, backing Rapido’s expansion during a crucial phase. However, the foodtech firm has not participated in any subsequent funding rounds, including Rapido’s most recent $200 Mn Series E led by Nexus Ventures in June 2025, when the bike-taxi platform also entered the unicorn club.

While Swiggy did not elaborate on the exact nature of the potential conflict, the re-evaluation may stem from increasing strategic overlaps between the two businesses, particularly in the mobility and quick commerce ecosystem. Sources familiar with the matter suggest Swiggy could also be exploring monetization of its stake to strengthen its balance sheet, especially in light of its intensified focus on profitability.

Swiggy’s Q1 FY26 Performance

The disclosure coincides with Swiggy’s Q1 FY26 earnings update, which showcased robust growth in both its food delivery and quick commerce verticals.

Swiggy reported a 45.2% year-on-year jump in consolidated Gross Order Value (GOV) to ₹14,797 crore for the quarter ended June 2025. The food delivery segment accounted for ₹8,086 crore in GOV, an 18.8% YoY increase from ₹6,808 crore in the same period last year. The platform added 1.2 million new Monthly Transacting Users (MTUs), pushing the total to a record 16.3 million, the highest addition in the last eight quarters.

However, the food delivery business also faced margin pressure, with adjusted EBITDA slipping to 2.4% from 2.9% in Q4 FY25, attributed to seasonal factors like the monsoon-driven reverse migration of delivery partners and employee appraisal cycles.

Swiggy’s quick commerce arm Instamart delivered impressive numbers. GOV surged 107.6% YoY to ₹5,655 crore, with the Average Order Value (AOV) increasing to ₹612, marking a 25.7% year-over-year growth. Instamart processed 92 million orders in the quarter. Swiggy also expanded its dark store network by adding 41 new locations, bringing the total to 1,062 stores across 127 cities.

At the end of Q1 FY26, Swiggy had ₹5,354 crore in cash and cash equivalents. The company reiterated its roadmap to achieve contribution margin breakeven in its quick commerce vertical between Q3 FY26 and Q1 FY27.

As Swiggy doubles down on scaling Instamart and improving operational efficiency, its evolving stance on strategic investments like Rapido could redefine its long-term business focus.

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