Swiggy Valuation Cut by 25% to $8 Billion by Invesco
- ByStartupStory | April 1, 2023
Swiggy, the Indian foodtech major, has reportedly been marked down by US-based investor Invesco by over 25% to $8 billion, months after investing in the company. According to regulatory documents viewed by TechCrunch, Invesco valued Swiggy at $8 billion in Q3 2022, down from the previous quarter’s $10.7 billion. This markdown occurred after Invesco led a $700 million funding round in Swiggy at a $10.7 billion valuation.
Swiggy, the Indian foodtech major, declined to comment on reports of a more than 25% markdown by US-based investor Invesco. According to an ET report, Invesco valued Swiggy at $4,759 per share in October 2022, down from $6,212 in July 2022, indicating a valuation of around $8.2 billion. This markdown puts Swiggy in the company of other Indian tech startups whose valuations have been reduced by investors due to volatile market conditions and weak global cues.
SoftBank had reduced the valuation of its portfolio company OYO from $10 billion to $2.7 billion earlier in the year, while Prosus had valued its stake in BYJU’S at $578 million in November, a significant drop from the edtech major’s previous $22 billion valuation. This news comes on a tough day for Swiggy, which saw the departure of Karthik Gurumurthy, head of its grocery vertical Instamart. The company’s valuation has also been marked down by more than 25% by Invesco, adding Swiggy to the list of Indian startups whose valuations have been lowered due to uncertain market conditions and weak global cues.
The recent markdown of Swiggy’s valuation by Invesco adds to the challenges faced by the foodtech major, which has been struggling with rising losses and cash burn. In the financial year 2021-22 (FY22), Swiggy’s net loss surged to INR 3,628.9 crore, more than twice the INR 1,616.9 crore loss in FY21. Swiggy has also come under scrutiny for various reasons, such as the large-scale layoffs it carried out earlier this year.
Swiggy’s recent layoffs were part of a broader restructuring plan that involved streamlining operations and selling off its loss-making Swiggy Access kitchen infrastructure business to Kitchens@. Additionally, the company also shut down its underperforming meat marketplace verticals. However, despite these efforts, Swiggy’s valuation has been cut down by Invesco amid the ongoing market downturn, which has also impacted other tech startups. For instance, Swiggy’s rival Zomato has seen its market capitalization drop by more than 69% from its all-time high in November 2021. Swiggy is also grappling with concerns around the looming recession and reduced user spending.
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