Swiggy IPO

Swiggy Set to Raise ₹5,000 Crore in Upcoming IPO: What Investors Need to Know?

In a highly anticipated move, Swiggy is ramping up efforts to dominate the food and quick commerce sector with its upcoming ₹5,000 crore IPO. The Bengaluru-based company is aiming to raise significantly more than the initially proposed ₹3,750 crore, signaling its intent to bolster its market share in a fiercely competitive space. Let’s dive into the details of Swiggy’s IPO plans and what it means for investors.

Swiggy’s ₹5,000 Crore IPO: What’s the Big Deal?

Swiggy’s board recently passed a special resolution to issue equity shares worth up to ₹5,000 crore, subject to shareholder approval at its extraordinary general meeting (EGM) on October 3. This marks a notable increase from the earlier target of ₹3,750 crore. According to an internal document accessed by Entrackr, the food delivery giant is also targeting ₹6,664 crore through an offer-for-sale (OFS).

In April, Swiggy had confidentially filed its IPO papers for a total of ₹10,400 crore (approximately $1.25 billion). With this move, the company is reportedly seeking a valuation of around $15 billion when it makes its stock market debut, cementing its position as one of India’s largest tech unicorns.

A Glimpse into Swiggy’s Financial Performance

Swiggy’s impressive financial performance in FY24 paints a picture of a company in growth mode. The company recently reported a 36% year-on-year increase in operating revenue, reaching ₹11,247 crore. This growth was primarily driven by its out-of-home consumption business, which includes its core food delivery platform, and its quick-commerce vertical, Instamart.

At the same time, Swiggy has made significant strides in reducing its losses. The company managed to cut its losses by 44%, from ₹4,179 crore in FY23 to ₹2,350 crore in FY24, signaling its path towards profitability.

Leadership Shakeup: Swiggy’s New Faces at the Helm

Swiggy has been actively reshuffling its leadership to strengthen its market position. The company recently appointed Dhruvish Thakkar as Assistant Vice President for Revenue and Growth at Swiggy Dineout. Thakkar brings a wealth of experience, having previously served as Senior Director, Head of Revenue and Marketing at Flipkart.

Before Thakkar, Amitesh Jha, Flipkart’s former Senior Vice President and Head of Grocery, was brought on board as the CEO of Swiggy Instamart. Jha’s leadership is expected to steer Swiggy’s quick-commerce business as competition heats up.

The Quick Commerce War: Swiggy Faces Fierce Competition

Swiggy’s Instamart has seen a sharp rise in competition from emerging quick-commerce players like Zepto, Blinkit, and BB Now. These companies have been expanding aggressively, scaling their dark store networks, and moving into new cities to gain an edge. Established e-commerce giants like Flipkart and Amazon have also entered the fray, adding further pressure.

According to a report by HSBC Global, Swiggy’s market share in the quick-commerce space has slipped from 52% in March 2022 to 32% in January 2024. In the same period, Blinkit has emerged as the market leader with a 40% share, while Zepto has gained ground, increasing its market share from 15% to 22%.

What’s Next for Swiggy?

With its upcoming

Swiggy IPO, Swiggy is set to make a bold statement in the market. The ₹5,000 crore it plans to raise will likely be channeled into expanding its core food delivery business and quick-commerce operations, allowing it to fend off competition and recapture market share.

Conclusion:

Swiggy’s upcoming IPO isn’t just a financial milestone—it represents the company’s broader strategy to solidify its position in India’s rapidly growing food delivery and quick-commerce sectors. With a valuation target of $15 billion, Swiggy is poised for significant growth, despite the intensifying competition from rivals like Blinkit and Zepto. For investors, Swiggy IPO offers an opportunity to be part of a tech unicorn’s exciting journey as it continues to reshape India’s e-commerce landscape.

FAQs:

1.What is the main purpose of Swiggy?

A. Besides food delivery, the platform also provides quick commerce services under the name Swiggy Instamart, and same-day package deliveries with Swiggy Genie. It rivals homegrown startup Zomato in food delivery and hyperlocal marketplace.

2.Who is the CEO of Swiggy?

A. Sriharsha Majety is the Co-Founder and CEO at Swiggy. Prior to Swiggy, he co-founded Bundl and also worked as an Associate at Nomura International’s offices in India and London.

3.What valuation is Swiggy targeting for its IPO?

A. Swiggy is reportedly targeting a valuation of around $15 billion for its IPO.

4.How has Swiggy’s financial performance been in FY24?

A. Swiggy saw a 36% increase in operating revenue in FY24, reaching ₹11,247 crore, while reducing its losses by 44%.

5.Who are the new leaders at Swiggy?

A. Swiggy recently appointed Dhruvish Thakkar as Assistant VP for Revenue and Growth at Swiggy Dineout and Amitesh Jha as CEO of Swiggy Instamart.

6.Which competitors are challenging Swiggy in the quick commerce space?

A. Swiggy faces stiff competition from players like Blinkit, Zepto, BB Now, as well as e-commerce giants like Flipkart and Amazon.

7.What is Swiggy’s market share in quick commerce?

A. Swiggy’s Instamart market share dropped from 52% in March 2022 to 32% in January 2024, according to HSBC Global.

8.Who is the current market leader in quick commerce?

A. Blinkit currently holds the largest market share in quick commerce, with 40% as of January 2024.

9.How has Zepto’s market share changed in quick commerce?

A. Zepto’s market share increased from 15% in March 2022 to 22% by January 2024.

10.Why is Swiggy’s IPO significant for investors?

A. Swiggy’s IPO offers investors a chance to invest in a leading tech unicorn with strong growth prospects in both food delivery and quick commerce.

Swiggy IPO

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