The battle for the top spot of the online food order and delivery business in India is set to get fiercer. After Swiggy raised $210 million fron DST Global in June, Zomato is now reportedly in talks with a Chinese investor Ctrip to raise funds.
According to a report in Economic Times, Ctrip may invest $100 million. Ctrip’s main business in China relates to online travel-booking and is one of the largest there. Interestingly, Ctrip has so far made only one key investment in India and that was in MakeMyTrip, operating in the same segment as Ctrip.
This is part of Zomato’s fund raising round where it is looking to raise up to $400 million (Rs 2,800 crore). Receiving funding from Ctrip will reportedly increase the valuation of Zomato to around $1.8 to $2 billion. Ctrip has a valuation of $20 billion.
ET quotes sources as saying that Ant Financial, the financing arm of Alibaba, which is already an investor in Zomato may also be participating in this funding round.
Ctrip is not only the largest travel portal in China but considered among the top four in the world, along with the leasers like Expedia, TripAdvisor and The Priceline Group. Some of the other ventures under Ctrip’s fold include Trip by Skyscanner, Travel4Fun and Trip.com. Skyscanner is a Scottish company engaged in the travel agency business and sold itself to Ctrip and the price paid was a whopping $1.7 billion.
Zomato has its own plan to expand overseas and this new association with Ctrip may go some distance in helping with those plans. The aggressive strategy being adopted in the Indian market by Zomato seems to be giving it more order, billings etc. as evidenced by the figures available in the public domain. The real challenge, however, has to do with the losses being made and how to reverse the trend to the positive.
This also comes nearly a week after Economic Times reported that Tencent, which owns WeChat wants to invest a major chunk of funds Swiggy is looking to raise. It has reportedly held talks with various investors to raise around $500-700 million.