Swiggy raises Rs 5,085 crore from anchor investors

Swiggy, one of India’s leading food and grocery delivery platforms, has raised approximately Rs 5,085 crore (around $600 million) from more than 75 anchor investors.

The Bengaluru-based company, which competes with Deepinder Goyal-led Zomato, announced the investment through a stock exchange filing on Tuesday.

Anchor investors, who received shares at Rs 390 per share, include prominent names like BlackRock, Fidelity, SBI Mutual Fund, ICICI Prudential, HSBC, and BNP Paribas.

IPO details: size and structure

Swiggy’s IPO, which is valued at Rs 11,327.43 crore, comprises both a primary issuance and a secondary offering by existing shareholders.

The primary issuance, or fresh fund raise, totals Rs 4,499 crore, while the secondary offering or Offer for Sale (OFS) stands at Rs 6,828 crore.

This IPO is expected to be one of the largest in India this year and is among the biggest in the country’s food technology sector, second only to Zomato’s public debut in 2021.

At the upper end of the price band of Rs 371-390, Swiggy aims for a valuation of Rs 87,300 crore ($11.3 billion).

Key investors and allotment details

A diverse group of domestic and international investors has backed Swiggy’s anchor portion, with a significant portion of the shares allocated to Indian institutions.

Among domestic investors are SBI Mutual Fund, Kotak Mutual Fund, HDFC Life, and Axis Mutual Fund.

The anchor allotments are designed to bring stability to the IPO, signaling strong institutional support that could attract additional interest from retail and non-institutional investors.

Financial performance and valuation

Swiggy has been focusing on growth, and its recent financials highlight significant improvements.

For FY24, Swiggy reported a 36% revenue increase, reaching Rs 11,247 crore, up from Rs 8,265 crore in FY23.

Losses also narrowed substantially by 44% to Rs 2,350 crore, compared to the previous fiscal year.

The IPO proceeds from the primary issue will support the company’s expansion, particularly in its dark store network, as well as investments in technology, marketing, and potential acquisitions.

Swiggy’s entry into the public market comes as it seeks to strengthen its position against its primary competitor, Zomato, which has a market valuation of Rs 2.1 trillion or Rs 2.18 lakh crore (as of November 6, 2024)