The food delivery landscape in India, long dominated by Zomato and Swiggy, is about to see a new player enter the ring — Rapido, known for its bike taxi services. However, according to global brokerage Bernstein, this entry is unlikely to dent the strong duopoly of Zomato and Swiggy.
In a detailed research note led by analyst Rahul Malhotra, Bernstein pointed out that the operational challenges and entrenched customer habits in the food delivery market heavily favor the current incumbents. While Rapido may attract some early users through lower commissions and potentially attractive delivery pricing, the core dominance of Zomato and Swiggy is expected to remain intact.
High Barriers to Entry in Food Delivery
According to Bernstein, food delivery is not just about logistics — it’s a high-complexity operation involving customer service, partner restaurant relationships, tech infrastructure, and timely fulfillment. These layers create a significant entry barrier for new players trying to enter the market at scale.
“Rapido may find it difficult to replicate the scale and ecosystem integration that Zomato and Swiggy have achieved over years,” the note said.
While Rapido’s pilot food delivery service is expected to launch in Bengaluru, analysts believe it will take considerable time, capital, and consistent execution for it to gain traction even in specific micro-markets.
Stock Market Reaction
News of Rapido’s food delivery ambitions stirred some movement in the stock market. Zomato-parent Eternal saw its shares trade slightly higher at ₹257.68, marking a 0.78% gain, possibly reflecting investor confidence in its resilience.
Swiggy, on the other hand, was seen under slight pressure, trading down by nearly 2% at ₹355.05. The dip suggests some short-term nervousness, but not necessarily a sign of structural threat from Rapido’s entry.
Despite short-term volatility, analysts reaffirm that the long-term dominance of the two market leaders remains intact.
Lower Commissions May Work at the Margins
Rapido’s strategy is believed to revolve around lower commissions, which could potentially make it attractive to small restaurants and customers in cost-sensitive regions. However, Bernstein notes that this edge is unlikely to translate into large-scale disruption.
“Lower commissions may help Rapido expand market share at the fringes,” the research note states, “but not enough to challenge the core business and scale of Zomato and Swiggy.”
Zomato and Swiggy’s established reach across Tier-1, Tier-2, and even Tier-3 cities, combined with their strong app ecosystems, loyalty programs, and aggressive marketing strategies, act as solid moats against new competition.
Rapido’s Existing Strengths
Rapido’s current strength lies in last-mile delivery and micro-mobility solutions, especially in cities with heavy traffic congestion. Its fleet of bike riders could potentially provide cost-efficient and fast deliveries, giving it some early momentum in localized markets like Bengaluru.
Still, building a strong food tech backend, scaling restaurant partnerships, and managing customer expectations will be a steep hill to climb.
A Test of Patience and Scale
While the entry of a new player adds fresh competitive energy to the sector, Bernstein believes the duopoly will remain largely unchallenged in the near future. For Rapido to pose a real threat, it would need to invest heavily in infrastructure, operations, and customer experience — areas where Zomato and Swiggy have already excelled.
Conclusion: Room to Grow, But Not Yet to Compete
Rapido’s move into food delivery reflects its ambition to diversify beyond bike taxis and parcel delivery, but disrupting an established duopoly is no small feat. While its strategy may allow it to carve out a niche, it’s unlikely to significantly impact Zomato or Swiggy’s market share in the foreseeable future, as per Bernstein’s analysis.
In a market where reliability, speed, and user experience rule — incumbents still have the upper hand.
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