Swiggy To Increase IPO Size, Eyes INR 5,000 Cr Via Fresh Issue

Swiggy’s Sriharsha Majety, Investors Sold Shares Worth INR 670 Cr Ahead Of IPO

SUMMARY

Swiggy plans to get shareholders’ nod to raise INR 5,000 Cr (about $600 Mn) through a fresh issue of shares as against INR 3,750 Cr (around $450 Mn) planned earlier

The food tech major will look to get the consent of its shareholders for its revised IPO plans at its extraordinary general meeting on October 3

Swiggy trimmed its consolidated net loss by 44% to INR 2,350 Cr in FY24 from INR 4,179 Cr in the previous fiscal year

Amid rekindled investor interest in public listings of India’s tech startups, food and grocery delivery giant Swiggy is considering increasing the fresh issue size of its initial public offering (IPO).

Swiggy plans to get shareholders’ nod to raise INR 5,000 Cr (about $600 Mn) through a fresh issue of shares as against INR 3,750 Cr (around $450 Mn) planned earlier, Entrackr reported, citing internal company documents.

The company will reportedly look to obtain the shareholders’ approval to raise a total of $1.4 Bn through its IPO, up from $1.25 Bn earlier, at its extraordinary general meeting (EGM), scheduled to be held on October 3.

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

It is pertinent to note that Swiggy filed for an IPO with market regulator SEBI through the confidential pre-filing route in April.

The proposed Swiggy IPO was a combination of fresh issue of equity shares worth INR 3,750 Cr ($450 Mn) and an offer-for-sale (OFS) component worth INR 6,664 Cr (around $799 Mn).

Swiggy’s IPO plans come despite the company‘s inability to clear the profitability hurdle in FY24 by most accounts. On the other hand, its archrival Zomato has been consistently improving its profit margins since first turning profitable in Q1 FY24.

While Swiggy managed to trim its losses in FY24, it still posted a consolidated net loss of INR 2,350 Cr during the year under review.

And simultaneously, Swiggy’s quick commerce arm Instamart also seems to be losing ground to competitors Blinkit and Zepto. While Blinkit is currently the market leader in the space, Zepto has raised millions of dollars in funding in recent months.

The competition is set to intesify with Walmart-backed ecommerce major Flipkart having recently joined the quick commerce race with Flipkart Minutes. Meanwhile, Tata-owned BB Basket is also fully pivoting to a quick commerce model.