China’s food delivery giant Meituan is reeling under intense competition, with profits plunging 97% last quarter. Its founder, Wang Xing, lost $1.1 billion in a single trading day as rivals Alibaba and JD.com poured billions into discounts and subsidies to grab market share.

Analysts call it a “subsidy war,” where companies burn cash on meal coupons and offers, prioritising user growth over profit. Meituan now faces heavy losses even as it tries to expand abroad.

For Indian readers, the story is a cautionary tale. India’s food delivery market, dominated by Zomato and Swiggy, has also relied on discounts to attract users. While these platforms are moving toward profitability, the Chinese example shows how quickly competition can erode gains if new players enter with deep pockets.

Experts say India’s platforms must balance growth with financial discipline, focusing on customer loyalty, technology, and diversified revenue streams. Otherwise, they risk falling into the same subsidy trap that is bleeding billions in China.

As India’s food-tech sector expands, the big question is: will our apps learn from China or repeat its mistakes?