Invesco Marks Up IPO-Bound Swiggy’s Valuation For Second Consecutive Time To $8.3 Bn

US-based fund manager Invesco has marked up Swiggy’s fair value for the second time in a row, now valuing the food aggregator at $8.3 Bn, according to a regulatory filing as on October 31, 2023.

With a 2% stake in Swiggy, Invesco’s 28,844 shares were valued at $147.6 Mn, reflecting a fair value of $8.3 Bn. The fund manager’s initial acquisition cost for the stake was $190.5 Mn, as per Tracxn data.

Invesco marked up the valuation of Swiggy by more than 42% to $7.85 Bn at the end of July last year.

In a turnaround for the foodtech major, Swiggy has seen its second valuation boost since facing two consecutive markdowns by Invesco. The US-based asset management company initially acquired a stake in January 2022, leading a $700 Mn funding round that valued Swiggy at $10.7 Bn.

However, Invesco subsequently slashed Swiggy’s valuation to $8 Bn in September 2022 and further down to $5.5 Bn by the end of April 2023. The recent upward revision brings Swiggy’s valuation back to $8.3 Bn as of October 31, 2023, which is still lower than the 2022 valuation.

Amid a series of valuation markdowns for Indian startups by global investment firms such as Prosus and Neuberger Berman, Swiggy’s recent positive valuation boost brings a sigh of relief. The reversal can be attributed to improved financial metrics and a more favourable macroeconomic environment.

Swiggy CEO Sriharsha Majety claimed last year that the company’s food delivery business achieved profitability (without factoring ESOP costs) as of March 2023. However, Swiggy reported a consolidated loss of INR 3,629 Cr in FY22 on a revenue of INR 5,704.9 Cr.

Back in November, Swiggy’s listed rival Zomato’s market capitalisation surpassed INR 1 Lakh Cr, thanks to its positive financial turnaround.

Zomato reported its second consecutive profitable quarter, with profit after tax surging to INR 36 Cr during the September quarter of the financial year 2023-24 (FY24).

The online food delivery market volume is estimated to reach $81.9 Bn by 2028, growing at a CAGR of 19.7% during 2023-2028.

Meanwhile, Swiggy is gearing up for its stock market debut, anticipated to take place in mid-2024. The initial public offering (IPO) is poised to become the most substantial IPO by an internet company this year, boasting an impressive issue size of $1 Bn.

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