Material Growth Opportunity Ahead for Deliveroo Despite Suboptimal Market Positions

Deliveroo is a food delivery company focused on logistics with a number-two or -three position, and we believe it's well positioned to benefit from the structural trend of increasing digitization of food delivery orders. A combination of a strong brand (high order frequency), exceptional service levels (leading average delivery times), strong and profitable market positions in key cities (70% market share in London with about 12% gross profit margin), a favorable restaurant mix (more than 80% of restaurants are independents), low capital intensity, and an untapped addressable market underpin Deliveroo’s investment thesis.