Uber to invest $247m in Indian entity to fuel Eats business

A man checks his smartphone whilst standing amongst illuminated screens bearing the Uber Technologies Inc. logo in this arranged photograph in London, U.K., on Tuesday, June 26, 2018. Photograph: Bloomberg

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.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.