Uber’s sole aim is to make its IPO successful and that is linked to how well it manages to sell the India growth story to the Street. A growing ride hailing business without the distractions of a food delivery business will allow it to do just that.
For Uber, this acquisition is seen as a strategy to reduce losses on a global level as it prepares for a possible public offering.
The company's nearest competitor Zomato recently raised $210 million from Alibaba's payment affiliate Ant Financial and is in talks for another round of funding.
Swiggy has competition from other food delivery companies and even ride-hailing companies Uber and Ola have entered the market.
Uber Eats is currently present in 37 cities in India with a strong presence in tier-2 cities.
Uber Eats is expected to help Cafe Coffee Day with data, analytics and insights to help identify food or cuisines that consumers crave the most.
Once the list is in place, it can be shared with state enforcement machinery for the action against non-compliant food business operators
Uber had launched Uber Eats in India in May last year and today expanded the service to five more Indian cities Tiruchirappalli, Surat, Nashik, Ludhiana and Mysore to now cover 28 cities.
"With Kolkatans' favourite eating joints - resturants, sweet shops, confectioners' outlets, fast food joints, coffee shops - on board with Uber Eats, we promise customers quick and reliable delivery so that they can enjoy their favourite food at the comfort of their homes," Rathod said after the app was launched.
Riders for food-delivery companies such as Uber Eats and Deliveroo are typically self-employed and the firms have come under fire for how they treat their workers.