Zomato takes ‘Wait and Watch’ approach on budget food delivery apps
Deepinder Goyal says Zomato will “wait and watch” before launching a new low-cost delivery app, as the company lowers its free-delivery threshold to attract value-conscious customers.
Akshita Toshniwal
Thursday October 16, 2025 , 2 min Read
Zomato Ltd is taking a cautious approach to India’s emerging budget food delivery market, choosing to serve cost-sensitive consumers through its existing app rather than launching a separate low-cost platform, founder and chief executive Deepinder Goyal said in the company’s latest shareholder letter.
The company, which competes with Swiggy and a growing list of new entrants such as Rapido’s Ownly, said it recently lowered the minimum order value for free delivery from Rs 199 to Rs 99 for its Gold members. The move is aimed at drawing in users looking for smaller, more affordable meals, a segment being targeted aggressively by new delivery startups.
“It appears that these apps are specifically targeting budget-conscious customers,” Goyal said, referring to new entrants. “At our end, we believe the Zomato app should be able to solve for these use cases without needing a new app.”
Goyal cautioned that creating a separate food delivery app for different customer segments would “significantly increase organisational complexity.” Zomato, he added, would “wait and watch” before taking such a step, and was “okay being the last mover” if the model proved viable over time.
The commentary comes at a time when the Indian food delivery market is seeing a new wave of experimentation. New apps such as Ownly and Toing are piloting low-cost delivery models that promise lower or zero commissions to restaurants, alongside affordable meals priced under Rs 150, in sharp contrast to Zomato and Swiggy’s broader, premium-leaning positioning.
Zomato’s CFO, Akshant Goyal, said the company’s take rate improved during the quarter due to higher ad monetisation, commissions, and platform fees. However, this did not fully translate into margin gains as the company’s decision to lower the minimum order value for free delivery led to more low-value, low-margin orders.
Moreover, the segment continues to suffer from multiple headwinds, including soft discretionary spending, consumption, quick commerce popularity and volatile weather conditions.
The core food delivery segment posted 22% growth in adjusted revenue to Rs 2,863 crore from Rs 2340 crore in the previous year. On a sequential basis, the segment grew 7% from Rs 2,657 crore in the previous quarter.
During the same period, Zomato's adjusted EBITDA grew to Rs 503 crore from Rs 341 crore in the previous year. It managed to increase monthly transacting customers to Rs 24.1 million, supported by 3.2 lakh restaurant partners.
Edited by Jyoti Narayan