Tencent joins Naspers in $1bn funding for India’s Swiggy

By Loni Prinsloo

(Bloomberg) – Tencent Holdings Ltd. joined Naspers Ltd. in a $1bn investment in Indian food delivery service Swiggy, which gains a potentially valuable ally in China’s largest social media and gaming company.

Naspers led the financing, which snagged new backers Hillhouse Capital and Wellington Management in addition to existing investors DST Global, Meituan Dianping and Coatue. The funding round, which Bloomberg reported on in October, marks Swiggy’s third for 2018 and largest to date. Naspers, Africa’s most valuable company, said it put up $660m.

“Swiggy has ten times the number of orders per month since our first investment” in 2017, said Larry Illg, Naspers’s chief executive officer of food and ventures. “Our latest round of capital will help to accelerate Swiggy’s journey of providing unmatched convenience in food ordering and delivery for Indian consumers.”

Swiggy is one of a clutch of fast-growing Indian startups capitalising on rapid smartphone adoption across the country. Its value was said to have risen to more than $2bn after Cape Town-based Naspers led two previous funding rounds, becoming the firm’s biggest shareholder. Since the last funding six months ago, Swiggy has expanded to 42 additional cities in India, the company said in a statement.

Food delivery is a favourite business of Naspers, with investments in Germany’s Delivery Hero and iFood in Brazil. It’s also taken a shine to India as it seeks to replicate a blockbuster early bet on Tencent, where it owns about 31 percent of the stock. This week, the Cape Town-based company took park in a $540m investment in Indian education startup Byju’s. It owns slices of other Indian businesses such as MakeMyTrip and OLX, and made a $1.6bn profit from selling its 11%stake in e-commerce startup Flipkart this year.

Naspers shares have fallen almost 19% this year, valuing the company at R1.2trn ($84bn), as a slump in Tencent’s share price dragged down the South African investor.