SUMMARY
- Swiggy plans to raise ₹5,000 crore through a new equity issue as part of its IPO, in addition to ₹6,664 crore through an offer for sale.
- The company’s board has approved the new issue, pending shareholder approval, with a revised total fundraising target of ₹10,400 crore.
- Swiggy has demonstrated strong financial growth, with a 36% revenue increase and a 44% reduction in losses, positioning itself as a significant player in the quick commerce market.
Swiggy, the prominent food delivery and quick commerce platform, is preparing to raise ₹5,000 crore ($602 million) through a new equity issue as part of its upcoming initial public offering (IPO). This decision marks a significant step in Swiggy’s expansion plans and follows a confidential filing of draft papers in April.
The company, backed by Prosus, has already targeted ₹6,664 crore through an offer for sale (OFS). The Swiggy board has passed a special resolution to issue shares worth up to ₹5,000 crore, pending approval at an extraordinary general meeting (EGM) scheduled for October 3.
Swiggy’s IPO plans include a total fundraising target of ₹10,400 crore, with ₹3,750 crore to be raised via the fresh issue and ₹6,664 crore through the OFS. The fresh issue amount, now 1.3 times higher than the initial estimate of ₹3,750 crore, reflects Swiggy’s robust financial performance and growth prospects.
Despite queries sent to Swiggy, there has been no official response regarding the IPO specifics. The company is expected to file its draft red herring prospectus (DRHP) with SEBI soon.
In preparation for the IPO, Swiggy has attracted strategic investments from Amitabh Bachchan’s Family Office and Hindustan Composites. Recent valuations by Baron Capital place Swiggy at approximately $14.5 billion. The firm has shown significant financial improvement, with a 36% increase in revenue to ₹11,247 crore in FY24 and a 44% reduction in losses to ₹2,350 crore.
Swiggy’s food business generated ₹6,100 crore in FY24, while its quick commerce arm, Instamart, contributed ₹1,100 crore in gross revenue. The company has invested $700 million into quick commerce to enhance its competitive edge against rivals like Zepto and Zomato’s Blinkit.
As Bengaluru emerges as a key player in the IPO landscape, following the debuts of Digit Insurance and Ola Electric, Swiggy’s IPO is set to further solidify the city’s position as a hub for startup listings. Additionally, Ather Energy, another Bengaluru-based firm, has also submitted its draft IPO papers, though its major stakeholder, Hero MotoCorp, has opted out of the OFS.
Source:- Entrackr
