Swiggy, one of India’s leading food delivery platform, has officially filed its Red Herring Prospectus (RHP) on October 28, paving the way for one of the largest initial public offerings (IPOs) of 2024.
The IPO is set to open for subscription on November 6 and will close on November 8, with a special bidding day for anchor investors on November 5.
In a strategic move, Swiggy has increased the size of its fresh issue to INR 4,499 Crore, up from INR 3,750 Crore outlined in its earlier draft RHP.
However, this remains below the INR 5,000 Crore ceiling that shareholders had previously approved.
The company has also revised its offer for sale (OFS) component, now pegged at up to 17.5 Crore equity shares, a reduction from the previous 18.53 Crore due to Naspers’ subsidiary MIH India Food Holdings deciding to sell fewer shares than originally anticipated.
Although Swiggy has yet to confirm its IPO price band, sources indicate it will likely range from INR 371 to INR 390.
Should it set the price at the upper limit, the total IPO size could exceed INR 11,300 Crore ($1.3 Bn), marking it as the second-largest IPO in India this year.
The IPO will feature participation from several prominent investors, including Accel, Alpha Wave Ventures, Coatue, Tencent, and Norwest Venture Partners, among others, who will sell shares through the OFS.
Additionally, Swiggy’s cofounders, such as CEO Sriharsha Majety, will also divest portions of their holdings.
In terms of share allocation, Swiggy has reserved 75% of the net offer for qualified institutional buyers (QIBs), while 15% is designated for non-institutional investors (NIIs) and 10% for retail investors.
The company will also set aside 7.5 lakh shares for its employees.
The proceeds from the IPO will be channeled into enhancing Swiggy’s dark store network, which has been allocated INR 1,178.7 Crore .
Another INR 1,115.3 Crore will be directed towards brand marketing and promotional activities, with INR 164.8 Crore earmarked for investments in its logistics arm, Scootsy.
A portion of the funds will also be utilized for potential acquisitions and other corporate needs.
Financially, Swiggy has demonstrated impressive growth despite incurring losses.
In the first quarter of FY25, the company reported a net loss of INR 611 Crore , an increase of 8% year-on-year, while operating revenue surged by 35% to INR 3,222.2 Crore .
For the entirety of FY24, Swiggy’s net losses were reduced to INR 2,350 Crore from INR 4,179.3 Crore the previous fiscal year, with total revenue climbing 36% to INR 11,247.3 Crore .
