Swiggy, one of India’s top food delivery platforms, is gearing up for its highly anticipated initial public offering (IPO), which will open to public subscription on November 6 and close on November 8.
Anchor investors are invited to bid on November 5, marking the first stage of an IPO in which Swiggy is expected to raise around Rs 11,300 crore.
Swiggy’s public offering comprises two parts: a fresh issue of shares valued at Rs 4,500 crore and an Offer for Sale (OFS) of shares worth Rs 6,800 crore from existing investors.
The OFS will see its shareholders such as Accel India, Alpha Wave Ventures, DST EuroAsia, Norwest Venture Partners, and Tencent Cloud Europe offloading a portion of their holdings.
Long-term investors such as Accel and Elevation Capital are set to gain significant returns, up to 35 times their initial investments in Swiggy. Despite the OFS, a few investors, such as SoftBank, have opted to retain their stake.
Founded in 2014, Swiggy initially focused on food delivery but has expanded to include Instamart, its instant grocery delivery service, as well as acquired restaurant booking platform Dineout. It also provides co-branded credit cards in partnership with HDFC.
Swiggy was valued at around $13 billion as of April. The company, however, has trimmed its valuation ahead of the IPO is is now eyeing a valuation of around $11.3 billion at the upper end of its IPO price band. The IPO price band has been set between Rs 371 and Rs 390 per share.
According to Swiggy’s IPO papers, the company plans to use the money from fresh issue to fund several strategic initiatives. It plans to invest approximately Rs 137.4 crore for debt repayment for its subsidiary Scootsy. It will use nearly Rs 982.4 crore fore support expanding Scootsy’s dark store network to improve Swiggy’s presence in the quick-commerce segment.
The expansion includes setting up new dark stores and covering leasing or licensing costs. Additionally, Swiggy has earmarked Rs 586.2 crore for technology and cloud infrastructure upgrades and Rs 929.5 crore for brand marketing. The company also plans to allocate funds for potential acquisitions.