(Yicai) Oct. 12 -- Keeta, the overseas food delivery platform of Chinese lifestyle service provider Meituan, has expanded its operations in Brazil to 32 cities from 11, one year after foraying into the South American market.

The expansion reflects Keeta’s long-term confidence in the Brazilian market, a company spokesperson said, adding that in the next phase, Keeta will continue to enhance its restaurant offerings and invest in technology, delivery, and local operations.

Keeta’s Brazilian platform boasts 83,000 registered restaurants and 430,000 registered delivery partners, with more than 10 million app downloads, according to data released by the firm.

Keeta began pilot operations in Santos and São Vicente in the state of São Paulo in October last year. Two months later, it officially entered São Paulo and eight other cities in the largest Brazilian city’s metropolitan area.

In February, Keeta slowed down its expansion and postponed its plans to enter Rio de Janeiro, focusing its resources on markets it considers more open to competition. The company said back then that it needed to address structural issues hindering healthy competition in the local food delivery market before expanding to other regions.

Meituan should not bluntly pursue expansion but select suitable locations and refine its business model before gradually growing, Chief Executive Officer Wang Xing said in March during an international communication meeting when discussing the Brazilian market.

IFood holds about 80 percent of the Brazilian food delivery market, according to recent data from its parent company Prosus. Industry experts believe that Keeta needs to find a sustainable growth model while competing for both merchants and consumer loyalty.

Keeta’s latest expansion was mainly driven by changes in local market competition, which created opportunities for new platforms to enter, Zhang Yi, CEO of iiMedia Research, told Yicai. Beyond the major cities where local platforms hold advantages, Keeta is exploring markets with different competitive landscapes, he noted.

After a period of trial operations, Meituan has been able to further refine and validate its local business model, Zhang said, adding that iFood has a strong market share and consumer recognition in Brazil.

"IFood has the most restaurants, and some local mid-to-high-end restaurants only offer delivery through iFood," a user living in São Paulo, previously told Yicai. However, iFood's prices are the highest, so he has gotten used to ordering takeout from Keeta or Didi’s 99Food, mainly because they offer coupons, the user explained.

However, Zhang said that considering the local scrutiny of irrational cash-burning behavior by platforms in Brazil, the model of users through subsidies may not be sustainable.

On Oct. 8, Prosus announced that competition had intensified significantly over the past 18 months, with rivals investing heavily to acquire new customers. Despite that, iFood lost only 5 percentage points of market share.

Editor: Futura Costaglione