A day after Uber Eats India gets acquired by Zomato, its valuation has grown by almost threefold, as compared to last year. This was specifically at a time when Uber was transferring its Indian business from the Netherlands entity to the Indian entity.
Zomato was valued last at $3 billion when it raised $150 million from Ant Financial. This included the valuation of the Uber Eats deal would be at around $300 million.
However, Would Zomato Be At The Zenith?
Till this time, Zomato was at the second position behind Swiggy in the food-tech market. This acquisition would add value to Zomato’s business, but would come with its own set of challenges too.
For that matter, Uber Eats occupied the third segment with 12 percent market share in the food delivery category, with around 26,000 restaurants across 41 cities. Analysts are of the view that with this acquisition, Zomato’s market share in the food-tech space helps it acquire the position of number one.
However, Zomato and Uber Eats do really need to worry about are the numbers. Reports state that Uber Eats India contributed 3 percent of global Uber Eats revenues, but have contributed a massive 25 percent of global interest, tax, depreciation, and amortisation (EBIDTA) losses, according to reports.
Is The Foodtech Sector Moving Towards A Duopoly Market?
Roughly started at around 2015, the food tech sector has been growing rapidly at a strong 150 percent CAGR and is now a $4.6 billion market, as per research and consultancy firm Reedseer.
There have been ongoing threats that Amazon’s entry into the food tech is looming large, with the e-commerce company already signing up restaurants. Amazon’s entry would lead to further aggressive spends by Zomato and Swiggy.
Of track, both Swiggy and Dunzo have been quite pro-active in trolling Zomato.
Here are some screenshots attached by users that have been quite popular on Twitter. However, these images weren’t found on Swiggy’s official handle and Dunzo had retweeted the image, and responded with funny comments.