According to CNBC’s calculations, since the beginning of 2023, Meituan – the leading food delivery company in China – has lost about $82 billion in market capitalization amid increasingly fierce competition and warnings from the board about slower growth in the core business.
LSEG data shows Meituan’s market cap has fallen nearly 60%, from HK$1.08 trillion (US$138.2 billion) to HK$441.06 billion (US$56.4 billion) over the same period. Meituan’s stock plummeted nearly 85% after peaking at HK$460 (around US$58.91) on Feb. 18, 2021 to HK$70.55 on Jan. 9.
However, according to research firm ChinaIRN, Meituan still dominates the online food delivery market in mainland China with nearly 70% market share in 2022. The company is facing fierce competition from rivals, especially Alibaba’s Ele.me, a prominent name in the food delivery industry.
Feifei Shen, director of The Blueshirt Group and a frequent online food orderer, noted that Ele.me is more aggressive and has more ways to provide discount codes than Meituan. “I always feel Ele.me orders are cheaper. I only think of Meituan when there is no code,” she said.
In the quarter ended Sept. 30, 2023, Alibaba’s domestic services segment – including food delivery – reported 16% revenue growth thanks to strong growth from Ele.me and transportation service Amap.
On Dec. 19, 2023, Chinese media reported that ByteDance’s Douyin is in talks to acquire Ele.me. In August 2022, Ele.me and Douyin partnered to allow stores on Ele.me to access Douyin’s video app users. However, ByteDance denied wanting to take over the food delivery platform.
