Swiggy Files RHP, Increases Fresh Issue Size To INR 4,499 Cr

After much ado, foodtech giant Swiggy finally filed its red herring prospectus (RHP) in the late hours of Monday (October 28). 

As per the IPO papers, the decacorn’s public issue will open for subscription on November 6 and close on November 8. Anchor investors will be able to bid for Swiggy shares on November 5.

As per the RHP, Swiggy has increased the size of the fresh issue to INR 4,499 Cr from INR 3,750 Cr in its updated DRHP. However, this is lower than the INR 5,000 Cr fresh issue size for which it received shareholders’ nod recently.

Meanwhile, the company also trimmed the size of its offer for sale (OFS) component to up to 17.5 Cr equity shares compared to up to 18.53 Cr in its updated DRHP filed in September. This came on account of Dutch investor Naspers’ subsidiary MIH India Food Holdings selling fewer shares (10.9 Cr to be precise) now versus 11.82 Cr shares as per the updated DRHP. 

While the company is yet to disclose its IPO price band, reports claim that Swiggy will set the price band in the range of INR 371 to INR 390. At the upper end of the spectrum, the IPO size would be over INR 11,300 Cr ($1.3 Bn).

Swiggy will likely finalise the basis of allotment of IPO shares by November 11 and the shares will be credited to the demat accounts of successful bidders by November 12. The shares will list on the BSE and the NSE on November 13.

Touted as the second biggest IPO of the year, the public issue will see investors Accel, Apoletto Asia, Alpha Wave Ventures, Coatue, Elevation Capital, Norwest Venture Partners, Tencent, among others, sell shares via the OFS component. 

Meanwhile, cofounders Sriharsha Majety (managing director and group CEO), Lakshmi Nandan Reddy (whole-time director, head of innovation), and Rahul Jamini will also offload a part of their shareholdings. 

Swiggy has reserved 75% of the net offer for qualified institutional buyers (QIBs) while 15% and 10% has been earmarked for non-institutional investors (NIIs) and retail investors, respectively. The company has also set aside 7.5 Lakhs shares for its employees. 

As per the RHP, Swiggy has set aside INR 1,178.7 Cr to shore up its dark store network and INR 1,115.3 Cr has been earmarked for brand marketing and business promotion expenses. It will use INR 164.8 Cr towards investment in its logistics subsidiary Scootsy.

An undisclosed amount of capital will also be utilised for funding inorganic growth through unidentified acquisitions and for general corporate purposes.

On the financial front, the company’s net loss rose 8% year-on-year (YoY) to INR 611 Cr in the June quarter (Q1) of the financial year 2024-25 (FY25). Operating revenue grew 35% YoY to INR 3,222.2 Cr in the quarter under review.

Meanwhile, the decacorn incurred a net loss of INR 2,350 Cr in the entirety of FY24 compared to a loss of INR 4,179.3 Cr in FY23. Revenue from operations zoomed 36% to INR 11,247.3 Cr in the fiscal under review from INR 8,264.5 Cr in the previous year.

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