Swiggy, the prominent Indian food delivery platform, has received approval from the Securities and Exchange Board of India (SEBI) to proceed with its Initial Public Offering (IPO). This significant step allows Swiggy to launch its IPO, expected in November 2024, with plans to raise over ₹11,000 crore (approximately $1.4 billion). The company aims to generate ₹5,000 crore through fresh share issuance and ₹6,664 crore via an offer-for-sale from existing shareholders.
IPO Structure and Financial Goals
Swiggy’s IPO will consist of a mix of new shares and an offer-for-sale component:
- Fresh Issuance: Approximately ₹5,000 crore.
- Offer-for-Sale: Around ₹6,664 crore from current investors.
This strategic move is designed to bolster Swiggy’s financial standing amid increasing competition in the food delivery and quick commerce sectors. The company has previously reported substantial losses, with a net loss of $207 million for the nine-month period ending December 2023.
Timeline and Next Steps
Before the IPO launch, Swiggy must publicly disclose its updated draft red herring prospectus (UDRHP) for a minimum of 21 days. During this period, the public can provide feedback on the offer document. Following this feedback window, Swiggy can officially proceed with its IPO.
- Expected Launch: November 2024
- Feedback Period: 21 days post UDRHP release
Market Context and Competitive Landscape
Swiggy’s IPO comes at a time when the Indian food delivery market is rapidly evolving. The company competes primarily with Zomato, which went public in 2021. Together, these two companies dominate over 90% of the market. Swiggy’s entry into the public market marks a pivotal moment for India’s startup ecosystem.
Key Investors
- Major backers of Swiggy include:
- Prosus
- SoftBank
- Accel
These investors are expected to play crucial roles in shaping investor sentiment during the IPO process.
Conclusion: A Milestone for Swiggy
The approval from SEBI represents a critical milestone for Swiggy as it prepares for its public debut. While profitability remains a concern due to recent financial losses, the company’s robust growth trajectory and strong market position make it an attractive opportunity for potential investors.
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