Swiggy Files Updated DRHP With SEBI For INR 3,750 Cr IPO

Foodtech giant Swiggy on Thursday (September 26) filed its first updated draft red herring prospectus (DRHP) with market regulator Securities and Exchange Board of India (SEBI) for an INR 3,750 Cr ($450 Mn) initial public offering. 

As per the DRHP, Swiggy’s public issue will comprise a fresh issuance of shares worth INR 3,750 Cr and an offer for sale (OFS) component of 18.53 Cr equity shares.

Factoring in the recent reported share purchases at around INR 350 apiece, the OFS component will be pegged at around INR 6,485 Cr. As a result, the total size of the company’s IPO will likely be around INR 10,000 Cr ($1.2 Bn). 

Investors such as Accel, Coatue, Alpha Wave, Elevation, Norwest and Tencent will sell shares as part of the OFS component. While Accel India IV (Mauritius) Ltd will offload 1.05 Cr shares, Alpha Wave Ventures will dump 55.73 Lakh shares as part of the OFS component. 

This comes days after reports surfaced that SEBI approved the DRHP filed by the foodtech major via confidential pre-filing route. 

The company plans to utilise the fresh IPO proceeds for marketing and promotional expenses (INR 929.5 Cr), investing in technology and cloud infrastructure, funding inorganic growth through acquisitions and for general corporate purposes.

A chunk of the capital will also be deployed to fuel its “material subsidiary” Scootsy. The company has earmarked INR 982.4 Cr for setting up Scootsy’s network of dark stores and for making lease and licence payments for these dark stores. 

“Investment in our material subsidiary, Scootsy, for: (a) expansion of our dark store network for our quick commerce segment through setting up of dark stores; and (b) making lease/ licence payments for dark stores,” added the DRHP.

In its DRHP, Swiggy said that Scootsy Logistics Private Ltd. will offer supply chain services to wholesalers and retailers including warehouse management, in-warehouse processing and order fulfilment services.

The book-running lead managers for the IPO are Kotak Mahindra Capital, JP Morgan India, BofA Securities, Citigroup Global, Jefferies, among others. 

Upon receiving SEBI’s approval, the startup will list its shares on the NSE and the BSE.

As per the DRHP, Swiggy net losses widened by more than 7% to INR 605.7 Cr in the first quarter (Q1) of the financial year 2024-25 (FY25) from INR 562.8 Cr in the corresponding period last fiscal. 

Meanwhile, revenue from operations jumped by nearly 35% to INR 3,222.2 Cr in the June quarter of the ongoing fiscal as against INR 2,389.8 Cr in Q1 FY24. 

Founded in 2014 by Sriharsha Majety, Nandan Reddy, Phani Kishan Addepalli, and Rahul Jaimini, Swiggy started off as a food delivery startup but later forayed into the quick commerce segment with Instamart.

It competes with the likes of listed foodtech major Zomato. 

The development comes five months after Swiggy initially filed its DRHP with SEBI via the confidential pre-filing route for an IPO worth INR 10,414.1 Cr in April. The company then received the greenlight from the regulator for IPO just days ago, as per reports. 

In the run up to the IPO, the company also roped in the family office of actor Amitabh Bachchan, actress Madhuri Dixit, cricketers Rahul Dravid and Zaheer Khan, tennis star Rohan Bopanna, director Karan Johar and actor and actor Ashish Chowdhry as investors. 

With this, Swiggy has become the latest Indian startup to join the IPO bandwagon. Buoyed by positive market sentiment and growing investor appetite for new-age tech companies, as many as ten Indian startups have listed on the bourses so far this year including Go Digit General Insurance, FirstCry, Unicommerce, TBO Tek, Ola Electric, Awfis, among others.

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