Where does Delivery Hero’s Asia GMV growth come from?

February 12, 2022

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Delivery Hero Group has faced brutal treatment since it reported 2021 FY results and 2022 outlook on Thursday (10 Feb):

A few readers have asked us that: Delivery Hero’s Asia business achieved GMV of EUR 23.9 billion (US$27.1 billion)in 2021, how come in Momentum Works Food Delivery Platforms 2022 report, we only estimated Foodpanda’s Southeast Asia GMV to be US$3.4 billion?

Let us answer this question.

First, we need to understand where does DeliveryHero’s Asia business include. In Asia, the group owns two brands:

Foodpanda, which operates in 8 countries in Southeast Asia, plus Hong Kong, Taiwan, Pakistan and Bangladesh; (it recently pulled out of Japan);
Baedal Minjok (Baemin), operated by Korea’s Woowa Brothers (which Delivery Hero acquired in 201), available in Korea, Japan, and Vietnam;

Amongst all these markets, we do not expect Pakistan and Bangladesh to contribute a significant amount of volume to the group.

Hong Kong and Taiwan, both developed economies with GDP similar to and twice of Singapore respectively, probably contributed significant GMV to Foodpanda. (We estimated the total 2021 food delivery GMV of Singapore to be US$2.9 billion.)

However, the lion’s share surely comes from Korea, where Woowa Group generated EUR 11.64 billion (US$13.2 billion) GMV in 2020, according to a Delivery Hero group release. That represents a 78% growth from 2019 if we remove the currency conversion factor.

In other words, if Woowa numbers were to be included in Delivery Hero’s 2020 reporting, it would have contributed to 70% of total volume in Asia. (Woowa numbers were only consolidated into the group from 1 Jan 2021 onwards).

And the rest of Asia would have generated about EUR 3 billion (US$3.4 billion) GMV in 2020, including Southeast Asia, where our estimate was US$2.0 billion.

If our estimate of Foodpanda’s Southeast Asia numbers is correct, this would mean that Korea occupied more than 70% of DeliveryHero’s Asia GMV in 2021.

“Quick commerce”

One caveat though, our numbers did not include the non-food delivery (groceries, quick commerce etc.), although these segments are probably just a small fraction of food.

We will study the groceries market in a little bit more detail – do look forward to our report on the matter in the coming months.