Swiggy is considering expanding its IPO by $150 million, potentially raising up to $1.4 billion. This would make it one of the largest public listings in India this year. The Bengaluru-based food delivery startup is seeking approval from shareholders to increase the fresh issue of shares to ₹50 billion ($600 million), up from the previously planned $450 million. The request for approval is set for an October 3 meeting, according to a 15-page notice.
Swiggy, valued at $10.7 billion in early 2022, also plans to sell approximately $800 million in shares from existing investors as part of the IPO. The company is aiming for a valuation of around $15 billion. This move positions Swiggy as a major player in India’s competitive food delivery and quick commerce sectors, where it contends with rivals such as Zomato, Tata-owned BigBasket, and Zepto, backed by General Catalyst.
Swiggy’s backers include well-known investors like Prosus Ventures, SoftBank, and Accel. The company reported $1.4 billion in revenue for the fiscal year ending March 2024, with its quick commerce service, Instamart, seeing an annual run-rate gross merchandise value of $1 billion.
The quick-commerce market in India is expected to face increased competition over the next 6-12 months, with the top three platforms—Swiggy, Zomato, and BigBasket—competing in each other’s markets. Bank of America analysts noted this trend in a report last month, stating that these companies are expanding their offerings and infrastructure, such as larger dark stores, to meet growing demand. However, the analysts pointed out that users are not very price-sensitive and already have diverse options, making it challenging for competitors to gain traction in each other’s strongholds.
Additionally, Bank of America projects that Indian companies could raise around $11 billion through IPOs and FPOs in the second half of this year.
Featured Image courtesy of Times of India
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