Food and grocery delivery giant Swiggy is set to make its stock market debut next week with the launch of its initial public offering (IPO). Swiggy IPO is set to hit the Street on November 6 and the SoftBank-backed company plans to raise more than Rs 11,000 crore from the primary market.
Several prominent investors, including Norway’s sovereign wealth fund Norges and Fidelity, have reportedly placed bids worth more than $15 billion in the Swiggy IPO, 25 times the $605 million portion reserved for such investors.
Here are 10 key things to know about the Rs 11,000 cr public issue:
1). IPO Schedule of Swiggy IPO
Swiggy IPO is set to open for public subscription on Wednesday, November 6, and will close on Friday, November 8.
2). Price Band and Lot Size of Swiggy IPO
The price band for Swiggy’s IPO has been set between Rs 371 and Rs 390 per share, with a lot size fixed at 38 shares. Retail investors are required to apply for a minimum of one lot, which consists of 38 shares, or in multiples of 38 shares. This structure allows investors to participate in the IPO within the specified price range.
3). Grey Market Premium (GMP) of Swiggy IPO
Market observers report that unlisted shares of Swiggy are currently trading at a grey market premium (GMP) of Rs 19 above its issue price.
This premium suggests that the grey market is anticipating a listing gain of approximately 4.87% from the upcoming public issue.
4). Allotment and Listing Date of Swiggy IPO
Shares of Swiggy are set to be listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on Wednesday, November 13. The allotment of shares is expected to be announced by November 12, ahead of the listing date.
5). Offer for Sale (OFS) Structure of Swiggy IPO
Swiggy’s IPO, valued at Rs 11,327.43 crore, comprises a fresh share sale of Rs 4,499 crore and an offer-for-sale (OFS) of up to 17.50 crore equity shares, totaling Rs 6,828.43 crore, by existing shareholders. This structure aims to raise substantial capital while providing an exit opportunity for current investors.
6). Reservation for Investor Categories in Swiggy IPO
In the Swiggy IPO, approximately 75% of the shares are reserved for Qualified Institutional Bidders (QIB), while 15% of the net issue is allocated for Non-Institutional Investors (NII) and 10% for retail investors. Additionally, the company has set aside up to 750,000 shares for its employees, offering them a discount of Rs 25 off the issue price.
7). Merchant Bankers and Registrars of Swiggy IPO
The book running lead managers for Swiggy’s IPO include Kotak Mahindra Capital Company, Citigroup Global Markets India, Jefferies India, Avendus Capital, JP Morgan India, BofA Securities, and ICICI Securities.
Link Intime India Private Ltd has been appointed as the registrar for the IPO, overseeing the subscription process and allocation of shares.
8) Financial Position of Swiggy IPO
Swiggy reported a revenue of Rs 3,222.2 crore for the quarter ended June 2024. For the fiscal year ending March 31, 2024, the company generated revenue of Rs 11,247 crore, representing a 36.1% increase from Rs 8,264.59 crore in fiscal 2023. Notably, Swiggy improved its losses, decreasing from ₹4,275.74 crore in fiscal 2023 to Rs 2,208.01 crore in fiscal 2024. In the June quarter of the current fiscal, the company’s loss was Rs 611 crore.
The earnings were primarily driven by its food delivery segment, which contributed Rs 1,729.63 crore, or 53.7% of total revenue for the June quarter. The quick commerce business followed, generating Rs 403.3 crore, accounting for 12.5% of the revenue, while the out-of-home consumption segment contributed only Rs 46.7 crore, or 1.4%.
9). Swiggy IPO Objectives
Swiggy plans to utilize the net proceeds from its IPO for several strategic purposes, including funding investments in its material subsidiary, Scootsy. The company also aims to enhance its technology and cloud infrastructure, along with allocating funds for brand marketing and business promotion efforts to boost awareness and visibility across various segments. Additionally, Swiggy intends to support inorganic growth through potential acquisitions and cover general corporate expenses.
10). About Swiggy
Swiggy, an online food and grocery delivery service, is recognized as one of the first hyperlocal commerce platforms in the industry. However, on the financial front, the company has reported consolidated losses for the past three fiscal years, highlighting ongoing challenges in achieving profitability.