Swiggy Filed an Updated DRHP With SEBI for Its INR 3,750 crore IPO

Nitin Konde, Apoorva Bajj

Sep 30, 2024 — 3 min read

Swiggy Filed an Updated DRHP With SEBI for Its INR 3,750 crore IPO

The draft red herring prospectus (DRHP) was submitted to SEBI, the markets regulator, by food aggregation and grocery delivery platform Swiggy on 26 September 2024. Through a new offering, the company hopes to raise INR 3,750 crore.

The IPO combines a new issue with an existing investor's offer to sell 185,286,265 shares. A large number of investors are liquidating some of their holdings, including Accel, Tencent, Elevation Capital, and Norwest Venture.

Several media reports suggest that the corporation might opt to augment the fresh issue component by INR 5,000 crore, thereby increasing the total allocation for new issues to INR 11,600 crore. The firm will make this decision during an EGM, likely to occur during the first week of October.

Prosus owns 32 percent of Swiggy, while SoftBank and Accel have separate shares of 8 and 6 percent. Other investors in the company include Singapore's GIC, Elevation Capital, DST Global, Norwest, Tencent, and Qatar Investment Authority (QIA).

How Company Will Be Utilizing the Investments?

The revenues of the IPO, according to the DRHP, will be utilised to fund the company's organic expansion, to develop its dark store network for its rapid commerce sector, to invest in technology and cloud infrastructure, and to expand its subsidiary Scootsy.

As of June 2024, the company had achieved a significant milestone with 112.7 million transacting users.

Consolidated operating revenue for Swiggy in FY24 was INR 11,247.4 crore, up 36% year over year. During the same time frame, losses have decreased by half. The combined gross order value (GOV) for B2C transactions in Q1 FY25 was INR 10,189.5 crore.

Swiggy’s Updated Market Performance

Over 150,000 restaurants in India are partners of Swiggy, an Indian startup founded in 2014. With deficits of INR 2,350 crore in FY24, Swiggy effectively reduced its losses by 43%, mostly due to the explosive development of the quick commerce and food delivery segments.

Operating revenue increased significantly by 36%, reaching INR 11,247 crore. In one month, 14.3 million customers transacted with the company's consumer-facing business, which includes dining services, Instamart, and food delivery, generating a gross order value (GOV) of INR 35,000 crore.

Game On – Indian Food Delivery Market

The food delivery market in India is a monopoly, with Swiggy and Zomato combined controlling over 90% of the market. Experts predict that it will reach a valuation of INR 2 lakh crore by 2030. Zomato went public in 2021, but Swiggy is expected to follow suit in the next few months. In January 2022, the organization conducted its most recent fundraising effort, valuing it at $10.7 billion. Nonetheless, bankers have stated in recent months that they are certain Swiggy may list with a valuation or market capitalization of between $10–13 billion.

In November 2023, Swiggy started preparing for its highly anticipated first public offering (IPO). There has been more activity on Swiggy in the secondary market since April. HNIs and family offices have purchased the company's shares, valued between $9 and 9.3 billion during secondary market transactions.