SUMMARY
- Swiggy’s cofounder Sriharsha Majety received a fresh bundle of stock options just prior to its IPO filing.
- Several senior executives, including new Instamart CEO Amitesh Jha, were given stock grants.
- They are expected to benefit from a total share-based compensation worth Rs 3,200 crore, equal to a stake of 3.5-4%.
Swiggy’s cofounder Sriharsha Majety received a fresh bundle of stock options just prior to its IPO filing. These options, included in a 2024 ESOP plan, are expected to increase his ownership by 2-2.3% and hold a value of over Rs 1,820 crore ($217 million) based on Swiggy’s latest share price in secondary sales, as noted by The Arc.
In addition to Majety, several senior executives, including new Instamart CEO Amitesh Jha, co-founders Nandan Reddy and Phani Kishan, Swiggy’s food delivery chief Rohit Kapoor, CFO Rahul Bothra, human resources director Girish Menon, and technology leader Madhusudhan Rao, were also given stock grants.
Together, these managers and employees are expected to benefit from a total share-based compensation worth Rs 3,200 crore ($380 million), equal to a stake of approximately 3.5-4%. None of these stock options have vested or been exercised yet, with the option vesting period ranging from 1-8 years. The value of this share-based compensation could increase further based on the outcome of the IPO.
The company’s IPO documents reveal that Majety currently holds a 6.23% ownership on a fully diluted basis, with co-founder Reddy at 1.76% through the same channels. This ownership also includes special grants and vested ESOPs.
Majety and Reddy founded Swiggy in 2013, with Majety serving as the managing director and group CEO, and Reddy leading the innovation division. Both are also members of Swiggy’s board of directors. Since April 2024, Majety has divested shares amounting to Rs 190-195 crore, and Reddy Rs 100 crore.
If Swiggy achieves an IPO valuation of $12 billion, Majety’s shareholding would exceed Rs 6,000 crore ($720 million). However, there could be significant tax obligations due to the substantial portion of his ownership being through ESOPs.
Just before its initial public offering in 2021, Zomato founder Deepinder Goyal was allocated ESOPs, which added an extra 4% to his ownership. At the time of Zomato’s public issue, Goyal’s newly acquired shares were valued at about Rs 2,800 crore ($333 million). Following the market bull run, their value has since surpassed Rs 10,000 crore ($1.12 billion). As of now, Goyal holds approximately 8% of Zomato, which includes both direct equity and shares from the special stock awards.
Given that the founders own less than 10%, Swiggy will be considered a professionally managed company in its listing, distinguishing it from a promoter-led entity. This would be similar to Zomato, Delhivery, PB Fintech and FirstCry. This status will enable Swiggy founders to receive more ESOPs, a feature unavailable in the case of a promoter-run business.
