Swiggy Sells Entire Rapido Stake To Prosus, Bags Nearly ₹2,000 Crore; SEBI Analyst Advises ‘Buy On Dips’

Dutch investment firm Prosus is doubling down on India’s mobility and delivery space, committing fresh funds to bike taxi startup Rapido. Prosus is reportedly investing around $350 million in Rapido, significantly higher than its earlier commitment of $200 million. The fresh investment will be a mix of primary infusion and secondary share purchases

A large portion of the deal involves Prosus acquiring Rapido shares worth nearly ₹1,968 crore from Swiggy, which has exited fully to avoid a conflict of interest.

Swiggy shares were down 1% in early trade on Wednesday, and it was among the top five trending stocks on Stocktwits.

Swiggy’s Exit

On Tuesday, Swiggy announced that it has signed a share purchase agreement (SPA) with MIH Investments One B.V. for the sale of its stake in Rapido.

Under the deal, Swiggy will divest 10 equity shares and 163,990 compulsorily convertible preference shares (CCPS) in Rapido for a total consideration of ₹1,968 crore.

MIH Investments One B.V. and MIH India Food Holdings BV are part of the Prosus group. Prosus is an existing shareholder in Swiggy.

Why Did Swiggy Sell Its Stake?

Rapido recently launched Ownly, a food delivery platform that will compete with Swiggy and Zomato. Swiggy had announced earlier this year that it was evaluating its shareholding in Rapido due to a conflict of interest.

Rapido’s Fundraising

Following the stake purchase, Prosus’ shareholding in Rapido is expected to rise from around 6.5% to 15%, making it one of the company’s largest shareholders after Westbridge Capital, which holds about 25%.

The fundraising round, which is expected to exceed $400 million, including Westbridge’s additional $49 million investment, is likely to rank among the largest for an Indian startup this year, according to reports. It also marks Rapido’s second major fundraising after securing $250 million in December 2024.

Prosus will inject an additional $125 million in fresh capital to accelerate Rapido’s expansion. 

Rapido is currently valued between $2.5 billion and $2.7 billion, more than twice its valuation of $1.1 billion last year.

Technical Take

Swiggy’s stock has been forming higher highs and higher lows since May and is currently trading above its 20-day, 50-day, 100-day, and 20-day moving averages, said SEBI-registered analyst Prabhat Mittal.

The moving average convergence (MACD) is flashing a buy signal, further supporting bullish momentum, he added.

However, after hitting a high of ₹2,845 on September 22, the stock witnessed profit booking and continues to trade near the day’s low, suggesting caution at elevated levels, Mittal observed.

He recommends waiting for the dips to take fresh positions, with a potential buying opportunity at ₹425, which could lead to ₹480 - ₹500 in the near term. Mittal also recommends a stop-loss at ₹405. 

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