Foodtech

Swiggy Receives SEBI Nod for $1.25 Billion IPO, Listing Likely in November

• ByStartupStory     |    September 25, 2024

Food and grocery delivery giant Swiggy has secured approval from the Securities and Exchange Board of India (SEBI) for its highly anticipated public listing. This follows its confidential Initial Public Offering (IPO) filing earlier this year, as confirmed by two sources familiar with the matter.

Swiggy will now need to submit an updated Draft Red Herring Prospectus (DRHP) before proceeding with its roadshows for the initial share sale. “The company will now need to submit an updated draft red herring prospectus (DRHP), after which Swiggy can begin its roadshows for the initial share sale,” said one of the sources, who requested anonymity.

Swiggy’s IPO is expected to launch in November, according to an earlier report by Mint. Despite inquiries, Swiggy has not yet responded to questions regarding the IPO.

Moneycontrol was the first to report this development.

A Major IPO for the Food Delivery Sector

Swiggy’s public listing comes almost three years after its primary competitor, Zomato, went public. Zomato’s stock has since surged, trading at nearly four times its original issue price of ₹76.

Swiggy’s IPO will likely feature both an offer-for-sale (OFS) and fresh issuance of shares, with the company targeting a valuation of around $15 billion. However, the final valuation will depend on the response during the roadshow.

Early Investors Likely to Sell Shares

Key investors such as Prosus Ventures, Norwest Venture Partners, and Goldman Sachs may sell a portion of their stakes in the $1.25 billion IPO. SoftBank, which has realized gains in other recent IPOs such as Ola Electric, Firstcry, and Unicommerce, is expected to retain its Swiggy shares, as reported by Mint.

Norwest and Prosus are among Swiggy’s early investors, with Goldman Sachs entering in 2021 when Swiggy was valued at $5 billion. SoftBank followed in 2022.

Financial Performance and Expansion Plans

Swiggy reported a 43% reduction in its losses in FY24, bringing its total loss down to ₹2,350 crore. This was driven by strong growth in its food delivery and quick commerce segments. Revenue from operations increased by 36% to ₹11,247 crore, with Swiggy’s gross order value (GOV) reaching ₹35,000 crore, supported by 14.3 million monthly transacting users.

Swiggy’s quick commerce arm, Instamart, posted a gross revenue of ₹1,100 crore in FY24, compared to Blinkit’s ₹2,301 crore. Instamart’s gross order value for the year stood at ₹8,100 crore, while Blinkit’s GOV reached ₹12,469 crore.

Swiggy plans to use a significant portion of the IPO proceeds to expand Instamart, its quick commerce division, in order to compete with Blinkit, Zepto, and BigBasket.

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