New Delhi:

Food delivery and quick commerce giant Swiggy has filed for a Rs 3,750-crore Initial Public Offering (IPO) in what is likely to be among India’s biggest listings this year.

On Wednesday, it came to light that Swiggy had received clearance for the IPO from markets regulator SEBI and the company said on Thursday that it aims to raise Rs 3,750 crore through a long-awaited public offering.

In its updated draft red herring prospectus, the Bengaluru-based company has said existing shareholders, including Tencent Europe and Accel India, will sell approximately 18.5 crore shares as part of an offer of sale (OFS). With the OFS, the IPO size will reportedly be over Rs 10,000 crore.

Founded in 2014, Swiggy, which is backed by Japan’s Softbank and investment group Prosus, had a valuation of nearly $ 13 billion in April this year and has over 4,700 employees.

According to news agency Reuters, Swiggy’s listing comes amid a booming IPO market, with 198 companies having raised $7.1 billion in the year up to September 4, which is more than double the amount in the same period last year.

Rs 137.41 crore of the proceeds from the fresh issue will be used for debt payment of subsidiary Scootsy, news agency PTI reported, citing the IPO papers. Rs 982.4 crore will also be invested in Scootsy to expand the dark store network in the quick commerce segment, with Rs 559.1 crore allocated for setting up dark stores and the remaining for lease or license payments.

The company will also invest Rs 586.2 crore in technology and cloud infrastructure, Rs 929.5 crore in brand marketing and business promotion, and some funds will also be allocated for inorganic growth and general corporate purposes.

Swiggy’s main competitor, Zomato, had gone public in 2021 and its shares have been among the top performers in the past 12-15 months. 

Mumbai: Food and grocery delivery startup Swiggy has received approval from the Securities and Exchange Board of India (Sebi) for a public listing, following its confidential IPO filing earlier this year, according to two people familiar with the development.

The company will now need to submit an updated draft red herring prospectus (DRHP), after which Swiggy can begin its roadshows for the initial share sale, the first of the two people cited earlier said, requesting anonymity.

Earlier this month, Mint reported that Swiggy’s initial public offering (IPO), one of the most-anticipated, is expected to open in November. Mint’s queries to Swiggy remained unanswered till press time.

Moneycontrol was the first to report the development.

Swiggy’s IPO comes almost three years after its closest competitor, Zomato, also backed by SoftBank, went public. Zomato’s stock is currently trading at nearly four times its issue price of ₹76.

Swiggy’s IPO is expected to include both offer-for-sale (OFS) and fresh issue of shares, with the company aiming for a valuation of around $15 billion. However, the final valuation will become clearer once the roadshow begins.

Details of the Share Sale

Prosus Ventures, Norwest Venture Partners, and Goldman Sachs may sell some of their Swiggy shares in the $1.25 billion IPO. SoftBank, which had realized profits in recent IPOs of Ola Electric, Firstcry, and Unicommerce, is expected to hold onto its stake, Mint reported earlier.

Norwest and Prosus are among Swiggy’s early investors, with Goldman Sachs joining in 2021 when Swiggy was valued at approximately $5 billion. SoftBank followed suit the following year.

Swiggy reduced its losses by 43%, totaling ₹2,350 crore in FY24, driven by rapid growth in its food delivery and quick commerce segments. Revenue from operations increased by 36%, reaching ₹11,247 crore. Its consumer-facing business, which includes food delivery, Instamart, and dining, reported a gross order value (GOV) of ₹35,000 crore, fuelled by 14.3 million monthly transacting users.

Swiggy Instamart’s gross revenue in FY24 stood at ₹1,100 crore, against Blinkit’s ₹2,301 crore. Instamart’s GOV, an indication of all transacted orders on the platform, for the year was ₹8,100 crore, while Blinkit’s stood at ₹12,469 crore.

The food delivery company plans to allocate most of the proceeds from its upcoming IPO to expand Instamart, its quick commerce business, to take on competitors like Blinkit, Zepto, and BigBasket.