American ride-hailing giant Uber Technologies Inc. is pumping in about $247 million (Rs 1,767 crore) in Uber India Systems Pvt Ltd in one of its largest infusions in the Indian unit.
According to the company’s filings with the Registrar of Companies (RoC) sourced by paper.vc, the Dutch entities of Uber, Uber International Holding B.V. and Uber International B.V., are subscribing to 10 million and 1.11 million shares of the Indian entity in exchange for the aforesaid investment.
‘We estimate that a large part of this allocation would go towards Eats business, therefore posing a direct challenge to other food delivery companies such as Swiggy and Zomato,” Vivek Durai, founder, paper.vc said.
According to a Mint report last month, Uber had brought its rides and food delivery businesses in India under Uber India Systems Pvt Ltd to comply with local regulations.
UberEats, which was in merger talks with Indian unicorn Swiggy earlier this year, is preparing to grab a share of the hyper-competitive food delivery market in India. Uber Eats entered India in May 2017, and grew by 50% (month-on-month) in its first year of operations, Mint said in a report this July. It is now eyeing young professionals in metros and joint families in smaller towns for an increased presence across the country.
Things, however, will not be easy considering the wide reach of food delivery biggies including Swiggy and Zomato. Quoting an investor, The Economic Times in an April report said that UberEats is a third of the size of Swiggy in terms of order numbers. Currently, Swiggy clocks nearly 1.4 million food orders daily across India.
Swiggy has raised a total of $1.5 billion in funding to date, and is in advanced stages of closing a $700-750-million round led by existing investor Naspers.
However, India continues to remain one of the key markets for Japan’s SoftBank-backed Uber Technologies, which has seen its stock plummet about 41% since a disappointing initial public offering in May.
Uber India Systems posted revenues of Rs 533 crore for the year ended March 2018, against Rs 410 crore in the previous year. Its net profit rose 39% to Rs 26 crore during FY18.