[Update] Swiggy IPO Sees Muted Response With 11% Subscription So Far

Update | November 6, 4:12 PM

The initial public offer (IPO) of foodtech major Swiggy was off to a slow start today (November 6), the first day of bidding, after the issue was subscribed just 11%. 

The public offer drew bids for 1.77 Cr shares as against 16.01 Cr shares on offer, according to exchange data.

As per BSE data, retail investors were at the forefront, buying 52% of the portion reserved for them. The non-institutional investors portion wass booked just 0.05X times while employee quota was subscribed 70%.

QIBs (qualified institutional buyers) were the least interested in Swiggy’s INR 11,324 Cr IPO with their portion yet to be booked.

Original Story | November 6, 12:08 PM

With the employee part leading the way, the initial public offering (IPO) of foodtech major Swiggy got off to a quiet and somber start today amid the buzz in the primary market with benchmark equity indices opening in green. 

The initial share sale of the foodtech decacorn received bids for 98.87 Lakh shares as against 16.01 Cr shares on offer on the first day of bidding as of 12 PM.

The startup’s IPO saw maximum interest from its employees. The portion reserved for employees saw 0.44X subscription, with bids received for 3.27 Lakh shares as against 7.50 Lakh shares reserved for them.

Retail investors placed bids for 85.37 Lakh shares as against 2.89 Cr shares on offer, resulting in a 0.29X subscription.

However, interest from non-institutional investors (NIIs) remained muted on day 1. NIIs bid for 10.22 Lakh shares as against the 4.34 Cr shares reserved for them, resulting in a mere 2% subscription.

The portion for qualified institutional buyers (QIBs) is yet to be booked.

Ahead of its IPO, the Sriharsha Majety-led company yesterday (November 5) raised INR 5,085 Cr from anchor investors.

Swiggy has set a price band of INR 371 to INR 390 per share for its public issue. At the upper price band, Swiggy is looking to raise INR 11,324 Cr from the initial share sale.

Swiggy currently commands a grey market premium (GMP) of INR 12 with its shares trading at a premium of 3% to the issue price.

The foodtech decacorn has increased the size of the fresh issue component of its IPO to INR 4,999 Cr while the offer for sale (OFS) component has been cut slightly to 17.5 Cr shares.

Under the OFS, early investors Accel India and Elevation Capital are set to fetch more than 34X returns by divesting a portion of their shareholding in Swiggy.

Swiggy is eyeing a valuation of $11.3 Bn for its IPO, 26% lower than the $15 Bn it targeted earlier.

Shares of the company are expected to list on stock exchanges BSE and NSE on November 13.

Analysts at SBI Securities and Bajaj Broking have assigned a ‘subscribe’ rating to Swiggy’s IPO  from a long-term investment perspective.

“While comparing with Zomato, the issue appears to be fairly priced on all these parameters. We recommend investors to subscribe to the issue for a long term investment perspective,” Bajaj Broking said in its IPO note.

It is pertinent to note that Swiggy is going public even as it continues to be loss-making. On the other hand, its arch rival Zomato is already a profitable company and outperforms Swiggy in most of the metrics across food delivery, quick commerce, and going-out verticals.

Swiggy’s consolidated net loss widened by over 8% year-on-year (YoY) to INR 611 Cr in the June quarter (Q1) of FY25 while operating revenue increased 35% YoY to INR 3,222.2 Cr. 

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