Swiggy is going to sell 12% of its Rapido stake.

In an attempt to simplify investments and concentrate on its main business, food delivery giant Swiggy plans to sell a 12% interest in bike taxi company Rapido. The action was taken as Swiggy rebalances its portfolio to focus on business priorities and gets ready for its highly anticipated first public offering.

Industry experts predict that secondary sales to both new and current strategic investors in Rapido will be used to complete the deal. Given Rapido's explosive expansion over the past two years, especially in tier-2 and tier-3 cities where demand for reasonably priced last-mile mobility solutions has increased, the purchase could yield large profits for Swiggy.

In 2022, Swiggy made its first investment in Rapido as part of its diversification plan to have a more robust presence in the logistics and mobility industry. With a major emphasis on gaining market share in urban mobility sectors where industry titans like Ola and Uber also compete, Rapido has since grown rapidly in both bike taxi and auto-rickshaw aggregation.

The planned stake sale indicates Swiggy's shift in strategy towards operational profitability and capital efficiency ahead of its public listing, even if the company still partners with Rapido for last-mile delivery solutions. According to analysts, this action will enable Swiggy to extract value from its portfolio while continuing to work strategically with Rapido.

Rapido is worth over $800 million and just raised new funds. This purchase could help the company's expansion aspirations by bringing in new investors. One of the most closely followed participants in the ride-hailing industry, the business has also been investigating government collaborations and electric mobility connections.

Industry analysts predict that both Swiggy and Rapido stand to gain from this development: Rapido will gain more investor confidence and growth momentum, while Swiggy will gain better balance-sheet flexibility.