Swiggy IPO Subscription Details on Day 1

6 Nov 2024 , 12:32 PM

The Swiggy IPO is now open for subscription, allowing investors to place bids until November 8.

Swiggy’s IPO valuation has been set at $11.3 billion, a reduction from its earlier target of $15 billion, with the company aiming to raise approximately ₹11,300 crore through this issue.

At the time of writing on the first of subscription, November 6, 2024 at 12:29 pm, Retail investors subscribing their portion with a 0.34 times bid. The employee reserved segment also performed well, achieving 0.49 times subscription. Non-institutional investor (NII) demand was modest, with only 0.03 times subscription, while qualified institutional buyers (QIBs) are yet to participate.

The IPO comprises a fresh equity issue worth ₹4,499 crore and an Offer for Sale (OFS) of 17,50,87,963 equity shares, offering investors the opportunity to buy into the company.

The price band for the IPO is set between ₹371-390 per share, with a minimum bid of 38 shares in one lot, and additional bids to be made in multiples of this lot size.

Proceeds from the IPO are designated for multiple areas, including investments in Swiggy’s subsidiary, Scootsy, technological upgrades, cloud infrastructure, and initiatives in brand marketing and business promotion, which will be executed over a four- to five-year period.

Swiggy faces significant competition from Zomato in India’s food delivery market. Both companies are heavily invested in the fast-growing quick-commerce sector, which promises rapid delivery of groceries and other essential items within 10 minutes.

Since its inception, Swiggy has recorded annual losses and has experienced negative cash flows from operations. For the financial year ending March 2024, Swiggy’s net loss was reduced to ₹2,350 crore, an improvement over the ₹4,179 crore loss in FY23 and the ₹3,628 crore loss in FY22.

Despite the losses, Swiggy’s revenue from operations saw significant growth, doubling from ₹5,704 crore in FY22 to ₹11,247 crore in FY24, highlighting the company’s increasing market presence and revenue generation capabilities.

Key financial institutions involved in managing the IPO include Kotak Mahindra Capital, Citigroup Global Markets, Jefferies India, and Avendus Capital, with Link Intime India appointed as the registrar for the issue.