Swiggy's IPO Dream Gets Wings As Shareholders ok $1.2 Bn Public Offer

Bengaluru-based food delivery giant Swiggy has garnered the green light from its shareholders for an ambitious initial public offering (IPO) valued at Rs 10,414.1 Cr ($1.2 Bn). The assent was granted during the company's Extraordinary General Meeting (EGM) held on April 23, as reported in regulatory filings.

The IPO package will consist of a fresh issue of shares amounting to Rs 3,750 crore, complemented by an offer-for-sale (OFS) component valued at Rs 6,664 Cr. Additionally, Swiggy is eyeing a pre-IPO placement worth Rs 750 Cr, intensifying its financial maneuvers in the lead-up to the public offering.

What Led To Swiggy's Valuation Surge?

Swiggy's IPO endeavors follow a significant valuation boost reported earlier this month by US-based Invesco, a key player in Swiggy's funding landscape. Invesco, which spearheaded a $700 Mn funding round for Swiggy, marked up the value of its stake in the food delivery behemoth.

What Are The Shares of Investors in Swiggy?

Dutch-listed Prosus emerges as the top investor in Swiggy, boasting 33% stake in the company. Prosus, holding a substantial 32 percent stake in Swiggy, seeks to trim its shareholding to below 25 percent. Trailing behind is SoftBank, with significant investment. Other notable shareholders in the food delivery giant include SoftBank (8 percent), Accel (6.2 percent), the founder group (6.7 percent), and Elevation Capital (4.4 percent), among others, according to data from Tracxn.

The company’s cofounders Sriharsha Majety, Nandan Reddy and Rahul Jaimini hold 4%, 1.6% and 1.2% stake, respectively, as per data platform Tracxn. Jaimini left his operational role in 2020 to join another venture–Pesto Tech.

The diverse investor roster underscores Swiggy's appeal and strategic positioning in the competitive market landscape.

In a regulatory filing post-EGM, Swiggy articulated its intent, stating, "...the consent and approval of the shareholders of the company be and is hereby according to create, issue, offer, allot and/or transfer of its equity shares up to an aggregate of Rs 37,501 million by way of a fresh issue of equity shares and an offer for sale of such number of equity shares up to an aggregate amount of Rs 66,640 million by certain existing shareholders….”.

Executive Restructuring at Swiggy

During the April 23 Extraordinary General Meeting (EGM), Majety and Reddy assumed new roles as executive directors within the company. Majety took on the mantle of Managing Director and Group CEO, while Reddy was appointed Whole-time Director and Head of Innovation.

Despite attempts to reach out, a spokesperson for Swiggy remained unresponsive at the time of reporting.

With shareholder approval, all eyes are on Swiggy as it embarks on its maiden journey into the public markets, poised to redefine the contours of India's food tech landscape.

Swiggy's Fiscal Year 2023 Performance Overview

In the fiscal year concluding in March 2023, Swiggy showcased robust growth, with revenue from operations reaching Rs 8,265 crore, marking a notable 45% surge compared to FY22. However, alongside this positive revenue trend, the company also witnessed a 15% increase in its net loss, which amounted to Rs 4,179 crore.

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