Swiggy, the Indian food tech giant, has received shareholder approval to increase the size of its Initial Public Offering (IPO) from Rs 3,750 crore to Rs 5,000 crore following the Extraordinary General Meeting (EGM) held on October 3. This decision allows the company to raise an additional Rs 1,250 crore through the primary issue, should market conditions favor such a move. The Offer for Sale (OFS) component remains at Rs 6,664 crore.
Swiggy’s IPO is poised to be one of the largest among new-age tech companies in India. With the potential to raise between Rs 10,414 crore ($1.25 billion) and Rs 11,664 crore ($1.4 billion), the IPO stands out for its scale. This move comes as Swiggy faces increasing competition from its closest rivals, including Zomato, Blinkit, Flipkart Minutes, and Tata BigBasket, all vying for market dominance in the quick commerce and food delivery sectors.
Strong Revenue Growth but Rising Losses Despite challenges, Swiggy has seen a significant surge in revenue, narrowing the gap with its primary competitor, Zomato. Swiggy’s FY24 revenue increased by 36%, jumping from Rs 8,265 crore in FY23 to Rs 11,247 crore in FY24. In parallel, the company managed to reduce its losses by 44% during FY24, bringing them down to Rs 2,350 crore.
However, the picture was less rosy in the first quarter of FY25. Swiggy reported widening losses, which grew by 8% to Rs 611 crore, primarily driven by a 27% increase in expenses, which surged to Rs 3,908 crore. The company continues to focus on growth initiatives, particularly in the hyper-competitive quick-commerce segment.
Swiggy’s strategic initiatives aim to strengthen its position in India’s fast-growing food and grocery delivery markets. While the rising losses may raise concerns, the company’s robust revenue growth demonstrates its potential to sustain long-term success. Swiggy is expected to leverage the IPO funds to invest further in technology, market expansion, and customer acquisition, thereby positioning itself for future profitability.
Key Highlights:
- Swiggy has increased its IPO size from Rs 3,750 crore to Rs 5,000 crore, with the total IPO value ranging from Rs 10,414 crore to Rs 11,664 crore.
- Swiggy’s FY24 revenue grew by 36% to Rs 11,247 crore, while losses decreased by 44%.
- In Q1 FY25, Swiggy’s losses widened by 8%, due to a 27% rise in expenses to Rs 3,908 crore.
- The IPO will support Swiggy’s growth amid rising competition from players like Zomato, Blinkit, and Flipkart Minutes.
Credit: This article is based on information from Business Standard and Economic Times.