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Swiggy Ltd.‘s  nearly ₹11,000 crore Initial Public Offering (IPO) will be open between November 6 and November 8, 2024. The company is has set a price band between ₹371 to ₹390 a piece.

Shares for the IPO will be allotted in lots of 38 and its multiples. The IPO consists of a fresh issue of ₹4,490 crore and about 17.5 crore equity shares offered for sale. The company plans to use most of the proceeds of the offer to invest in expansion of its dark stores for its quick commerce business Instamart. Another ₹1,150 crore would be spent on brand expansion and marketing, according to the company’s prospectus.

Swiggy is not yet profitable and that is among the first risks. “We have incurred net losses in each year since incorporation and have negative cash flows from operations. If we are unable to generate adequate revenue growth and manage our expenses and cash flows, we may continue to incur significant losses” the company said in its prospectus.

Speaking about the looming slowdown in urban consumers and its impact on Swiggy’s potential performance, the Chief Executive Officer Sriharsh Majetty said “At this point we are not seeing that. The businesses have been demonstrating strong growth. We continue to serve the consumers well and making sure that demand continues to flow through.” at a media briefing.

Swiggy has in recent weeks cut its internal valuation goal twice by a combined 25% due to volatility in the Indian stock markets. File.
| Photo Credit: Reuters

Food delivery giant Swiggy will likely price its $1.35 billion domestic initial public offering, which opens next week, at ₹371-390 per share, sources with direct knowledge of the matter told Reuters.

The IPO will open for subscription from Nov. 6 to Nov. 8, the company’s red herring prospectus dated Monday (October 28, 2024) showed. Anchor investors will bid for shares on Nov. 5.

Swiggy is expected to list its shares on November 13.

The share sale will be the country’s second-biggest stock offering this year, behind Hyundai Motor India’s $3.3 billion IPO earlier this month, which had seen subdued interest from retail investors.

The food and grocery delivery firm, which competes with listed rival Zomato, will sell new shares worth ₹44.99 billion, more than the ₹37.5 billion originally planned.

Existing shareholders including Prosus and Tencent are selling a total of 175.1 million shares.

Swiggy has in recent weeks cut its internal valuation goal twice by a combined 25% due to volatility in the Indian stock markets. It was initially looking at a valuation of as much as $15 billion, but following those cuts, it is now targeting $11.3 billion.

Swiggy did not respond to a Reuters request for comment.

Benchmark Nifty 50 index is now down more than 8% from record highs hit on Sept. 27 due to persistent foreign selling.

Despite recent jitters, India’s IPO market has been buoyant, with around 270 companies raising $12.57 billion so far this year, well above the $7.4 billion raised in all of 2023, LSEG data showed.