Swiggy, India’s second-largest food delivery platform is set to go public with its highly anticipated initial public offering (IPO). Founded in 2014, Swiggy has transformed the Indian food delivery landscape, trailing only behind Zomato in market share. This article provides a comprehensive analysis of Swiggy’s IPO, examining its financials, market position, competition and growth prospects.
In this Swiggy IPO detailed analysis, We’ll explore
- Company Overview
- SWOT Analysis
- Financial performance analysis
- Market positioning and competition
- Growth Prospects and Challenges
- Swiggy IPO Day-wise GMP
Read the full article to Make informed investment decisions.
About – Swiggy
Swiggy IPO – Review
Overview
Swiggy is an Indian online food ordering and delivery company founded in 2014 and headquartered in Bangalore. It operates in over 580 Indian cities The Company provides a range of services beyond food delivery, including quick commerce through Swiggy Instamart and same-day package deliveries via Swiggy Genie. Swiggy has established itself as a leading player in the food delivery market.
Swiggy holds a 34% market share in the food delivery segment, trailing behind Zomato’s 58%. Key competitors include Zomato, Dunzo, Uber Eats, BigBasket, DoorDash, FreshMenu, Blinkit, Foodpanda and Zepto.
Swiggy employees approximately 5,000 people as of March 2024 and has subsidiaries such as InsanelyGood and Dineout. Since its inception, Swiggy has grown significantly, making it a key player in India’s thriving food delivery and quick commerce industry.
SWOT Analysis
Industry Outlook
- Growing Demand: India’s food delivery market is expected to reach $43.78 billion by 2024, with a CAGR of 15.98% from 2024 to 2029.
- Expanding Customer Base: The addressable customer base is expected to expand from 320-340 million to 430-450 million by 2030.
- Rising Consumption Occasions: Indians eat out an average of five times per month, expected to increase to 7-8 times by 2030.
- Digital Payments: Adoption of online payment methods is increasing due to growing consumer awareness and partnerships between banks and online food delivery service providers.
- Increasing urbanization and busy lifestyles
- Rising disposable incomes
- Growing smartphone penetration
- Improving internet connectivity
- Expanding restaurant supply
- Intense competition
- Thin profit margins
- High operational costs
- Food quality and safety concerns
- Regulatory hurdles
SWOT Analysis
Strengths
Strong brand recognition: Wide restaurant network.
Diversified services: Includes food delivery and quick commerce.
Efficient mobile app: User-friendly interface.
Strategic partnerships: Collaborations with restaurants and suppliers.
Revenue growth: 27.3% CAGR.
Convenience and variety: Broad menu options.
Weaknesses
Recurring losses: Net losses since inception, ₹-2,350 crore in FY24.
High operational costs: Thin profit margins.
Reliance on third-party deliveries: Limited control.
Intense competition: Strong rival presence.
Regulatory challenges: Food safety concerns.
Delivery fees: May deter some customers.
Opportunities
Growing food delivery demand: Expanding market.
Customer base growth: Predicted increase by 2030.
Online payment adoption: Boosts convenience.
More consumption occasions: 5-7 times per month.
Expansion possibilities: New cities and services.
Financial partnerships: Strengthens offers.
Threats
High competition: Market crowded with rivals.
Regulatory changes: Food safety and compliance risks.
Economic downturn: Potential spending declines.
Supply chain issues: Disruptions affect logistics.
Cybersecurity risks: Data protection challenges.
Swiggy IPO Details
Swiggy IPO Details :
Swiggy’s initial public offering (IPO) is scheduled to take place from November 6, 2024, to November 8, 2024. The price band for the IPO is set at ₹371 to ₹390 per share, with a face value of ₹1 per share. Investors can bid for a minimum lot size of 38 shares
The total issue size is 290,446,837 shares, aggregating up to ₹11,327.43 crore. This comprises a fresh issue of 115,358,974 shares, worth ₹4,499.00 crore, and an offer for sale of 175,087,863 shares, worth ₹6,828.43 crore.
Eligible employees will receive a discount of ₹25 per share. The IPO is a book-built issue, and shares will be listed on both the BSE and NSE.
Pre-IPO, the total shareholding stands at 2,123,066,748 shares, which will increase to 2,238,425,722 shares post-IPO.
| IPO Date | November 6, 2024 to November 8, 2024 |
| Listing Date | [.] |
| Face Value | ₹1 per share |
| Price band | ₹371 to ₹390 per share |
| Lot Size | 38 shares |
| Total issue size | 290,446,837 shares (aggregating up to ₹11,327.43 Cr) |
| Fresh issue | 115,358,974 shares (aggregating up to ₹4,499.00 Cr) |
| Offer for sale | 175,087,863 shares of ₹1 (aggregating up to ₹6,828.43 Cr) |
| Employee Discount | ₹25 per share |
| Issue Type | Book Built issue IPO |
| Listing At | BSE, NSE |
| Share holding pre issue | 2,123,066,748 |
| Share holding post issue | 2,238,425,722 |
Swiggy IPO Reservation
| Investor Category | Shares offered | Maximum Allottees |
| Anchor Investor Shares Offered | 13,03,85,211 (44.88%) | NA |
| QIB Shares Offered | 8,69,23,475 (29.92%) | NA |
| NII (HNI) Shares Offered | 4,34,61,737 (14.96%) | |
| bNII > ₹10L | 2,89,74,491 (9.97%) | 54,463 |
| sNII < ₹10L | 1,44,87,246 (4.99%) | 27,231 |
| Retail Shares Offered | 2,89,74,491 (9.97%) | 7,62,486 |
| Employee Shares Offered | 7,50,000 (0.26%) | NA |
| Total Shares Offered | 29,04,94,914 (100%) |
Swiggy IPO Anchor investors Details
| Bid Date | November 5, 2024 |
| Shares offered | 130,385,211 |
| Anchor Portion Size (In Cr.) | 5,085.02 |
| Anchor lock-in period end date for 50% shares (30 Days) | December 11, 2024 |
| Anchor lock-in period end date for remaining shares (90 Days) | February 9, 2025 |
Swiggy IPO Lot Size
| Application | Lots | Shares | Amount |
| Retail (Min) | 1 | 38 | ₹14,820 |
| Retail (Max) | 13 | 494 | ₹192,660 |
| S-HNI (Min) | 14 | 532 | ₹207,480 |
| S-HNI (Max) | 67 | 2,546 | ₹992,940 |
| B-HNI (Min) | 68 | 2,584 | ₹1,007,760 |
Swiggy IPO Timeline
| IPO Open Date | Wednesday, November 6, 2024 |
| IPO Close Date | Friday, November 8, 2024 |
| Basis of Allotment | Monday, November 11, 2024 |
| initiation of refunds | Tuesday, November 12, 2024 |
| Credit of Shares to Demat | Tuesday, November 12, 2024 |
| Listing Date | Wednesday, November 13, 2024 |
| Cut-off time for UPI mandate Confirmation | 5:00 PM on Thursday, November 8, 2024 |
Swiggy Financials
| Particulars | Period ended June 30, 2024 | Period ended March 31, 2024 | Period ended March 31, 2023 | Period ended March 31, 2022 |
| Assets | 10,341.24 | 10,529.42 | 11,280.65 | 14,405.74 |
| Revenue | 3,310.11 | 11,634.35 | 8,714.45 | 6,119.78 |
| Profit After tax (PAT) | -611.01 | -2,350.24 | -4,179.31 | -3,628.9 |
| Net Worth | 7,444.99 | 7,791.46 | 9,056.61 | 12,266.91 |
| Reserves and surplus | -7,750.85 | -7,880.85 | -6,510.34 | -3,311.1 |
| Total Borrowing | 256.61 | 211.19 | — | — |
| EBITDA margin (%) | 22 | — | -43.90 | -52.88 |
Swiggy IPO Promoter Holding
| Share Holding Pre issue | 63.56% |
| Share Holding Post issue |
Swiggy KPI (Key Performance indicators)
| KPI | Values |
| RoNW (%) | -8.21 |
| P/BV | 11.6 |
| Pre IPO | Post IPO | |
| EPS (₹) | -11.07 | -10.92 |
| P/E (x) | -35.23 | -35.72 |
Swiggy IPO Subscription Status (Bidding Details)
| Category | Subscription (times) | Shares offered | Shares bid for |
| QIB | 6.02 | 8,69,23,475 | 52,30,89,494 |
| NII | 0.41 | 4,34,61,737 | 1,79,02,218 |
| bNII (bids above ₹10L) | 0.37 | 2,89,74,491 | 1,07,03,612 |
| sNII (bids below ₹10L) | 0.50 | 1,44,87,246 | 71,98,606 |
| Retail | 1.14 | 2,89,74,491 | 3,30,77,746 |
| Employee | 1.65 | 7,50,000 | 12,37,546 |
| Total | 3.59 | 16,01,09,703 | 57,53,07,004 |
Total Application : 7,15,124
Swiggy IPO Day-wise Grey Market Premium (GMP)
| GMP Date | IPO Price | GMP | Sub2 Sauda rate | Estimated Listing Price | Last Updated |
| 12-11-2024 | 390.00 | ₹2 | 100/1400 | ₹392 (0.51%) | 12 November, 2024 |
| 11-11-2024 | 390.00 | ₹1 | — | ₹391 (0.26%) | 11 November, 2024 |
| 10-11-2024 | 390.00 | ₹1 | — | ₹391 (0.26%) | 10 November, 2024 |
| 09-11-2024 | 390.00 | ₹1 | — | ₹391 (0.26%) | 09 November, 2024 |
| 08-11-2024 (Close) | 390.00 | ₹1 | — | ₹391 (0.26%) | 08 November, 2024 |
| 07-11-2024 | 390.00 | ₹2 | 100/1400 | ₹392 (0.51%) | 07 November, 2024 |
| 06-11-2024 (Open) | 390.00 | ₹9.50 | 300/4200 | ₹399.5 (2.44%) | 06 November, 2024 |
| 05-11-2024 | 390.00 | ₹12 | 300/4200 | ₹402 (3.08%) | 05 November, 2024 |
| 04-11-2024 | 390.00 | ₹20 | 600/8400 | ₹410 (5.13%) | 04 November, 2024 |
| 03-11-2024 | 390.00 | ₹22 | 600/8400 | ₹412 (5.64%) | 03 November, 2024 |
| 02-11-2024 | 390.00 | ₹22 | 600/8400 | ₹412 (5.64%) | 02 November, 2024 |
| 01-11-2024 | 390.00 | ₹18 | 500/7000 | ₹408 (4.62%) | 01 November, 2024 |
| 31-10-2024 | 390.00 | ₹18 | 500/7000 | ₹408 (4.62%) | 31 October, 2024 |
| 30-10-2024 | 390.00 | ₹25 | 700/9800 | ₹415 (6.41%) | 30 October, 2024 |
| 29-10-2024 | 390.00 | ₹25 | — | ₹415 (6.41%) | 29 October, 2024 |
| 28-10-2024 | ₹0 | — | ₹ (0%) | 28 October, 2024 | |
| 27-10-2024 | ₹0 | — | ₹ (0%) | 27 October, 2024 | |
| 26-10-2024 | ₹0 | — | ₹ (0%) | 26 October, 2024 | |
| 25-10-2024 | ₹0 | — | ₹ (0%) | 25 October, 2024 | |
| 24-10-2024 | ₹0 | — | ₹ (0%) | 24 October, 2024 |
Swiggy Stock Buy or Not?
Buy
Recommendation Weight: 40%
Growing demand for food delivery and quick commerce
Strong brand recognition and wide restaurant network
Expansion into new services (Instamart, Genie)
Potential for improved profitability with scale
Avoid
Recommendation Weight: 30%
Consistent net losses since inception
High operational costs and thin profit margins
Intense competition from Zomato and new entrants
Neutral
Recommendation Weight: 30%
Valuation: $11.3 billion, relatively high compared to peers
Market share: 34% in food delivery, 25% in quick commerce
Growth prospects: dependent on execution and market trends
IPO timing: pending, may impact stock performance
Final Verdict
Swiggy’s IPO is a high-risk, high-reward opportunity. Investors seeking growth potential in the booming food delivery and quick commerce market may consider Swiggy. However, cautious investors may want to wait for improvements in the company’s financials and competitive positioning.
Conclusion
Swiggy’s IPO presents a mixed bag of opportunities and challenges. As India’s leading food delivery and quick commerce platform Swiggy boasts impressive revenue growth, diversification and strong brand presence. However consistent net losses, intense competition, thin profit margins, and dependence on discounts raise concerns.
Disclaimer
This article is not written by a financial advisor, and it should not be considered as personalized financial advice. It is essential to consult a financial expert before making any investment decisions or Do your own research before investing.
FAQ?
Q: What services does Swiggy offer?
Ans. Swiggy offers food delivery, quick commerce (Swiggy Instamart), and same-day package deliveries (Swiggy Genie).
Q: What is Swiggy Instamart?
Ans. Swiggy Instamart is Swiggy’s quick commerce service
Q: What is Swiggy Genie?
Ans. Swiggy Genie is Swiggy’s same-day package delivery service.
Q: What is Swiggy’s revenue?
Ans. Swiggy’s revenue is ₹11,247 crore (US$1.3 billion) in FY24.
Q: Who are Swiggy’s competitors?
Ans. Swiggy’s competitors include Zomato, Dunzo, Uber Eats, BigBasket, DoorDash, FreshMenu, Blinkit, Foodpanda, Zepto.
Q: What is Swiggy’s net profit?
Ans. Swiggy incurred a net loss of ₹-2,350 crore (US$-280 million) in FY24.