Synopsis
- IPO Launch Date: November 6-8, 2024.
- Price Band: ₹371-₹390 per share.
- Structure: ₹4,499 crore fresh issue, ₹6,828.43 crore offer-for-sale.
- Investor Reservations: 10% for retail investors; ₹25 discount for employees.
- Grey Market Premium: Currently around ₹15, reflecting tempered listing gains.
- Valuation Adjustments: Revised to $11.3 billion due to market conditions.
- Competitive Edge: Swiggy's quick commerce is 40% of revenue, positioning it well against competitors.
Swiggy IPO Overview
Swiggy’s IPO will open on November 6, closing on November 8, 2024. Shares will be priced between ₹371 and ₹390, with a minimum application of 38 shares. Swiggy aims to raise ₹11,327.43 crore, split into ₹4,499 crore in fresh shares and ₹6,828.43 crore in an offer-for-sale by existing shareholders. The IPO includes a 10% allocation for retail investors, along with 7.5 lakh equity shares designated for eligible employees.
Grey Market Insights and Market Outlook
In the grey market, Swiggy’s shares are currently showing a premium of ₹15, suggesting limited early gains of about 4% over the upper price range. Swiggy’s GMP, which had previously hit ₹25, has seen declines amidst market volatility, highlighting the cautious investor sentiment surrounding this IPO.
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Investment Perspective
Despite lukewarm grey market sentiments, the IPO has attracted prominent investors like Norway’s sovereign wealth fund Norges Bank and Fidelity, who have shown significant interest. Swiggy has adjusted its target valuation from $15 billion to $11.3 billion to better align with current market conditions. The IPO will be listed on the BSE and NSE on November 13; allotment is expected on November 12.
About Swiggy
Since 2014, Swiggy has been a leader in food and grocery delivery, with services spanning across food delivery, groceries, and out-of-home convenience through its “Instamart” brand. This quick-commerce division has contributed to 40% of Swiggy’s total revenue, a significant growth area as the quick-commerce market is set to expand at a 148-169% CAGR. In the 2024 fiscal year, Swiggy’s revenue surged by 34% to ₹11,247 crore, with operational losses reduced to ₹2,350.24 crore.
Glossary of Key Terms for Swiggy IPO
Allotment Date: The scheduled date when IPO shares are assigned to applicants.
GMP (Grey Market Premium): The extra price paid in the unofficial market before official listing, suggesting market demand.
BSE (Bombay Stock Exchange): India’s main stock exchange for public company trading.
NSE (National Stock Exchange): Another major Indian exchange for stocks and derivatives.
IPO (Initial Public Offering): The first sale of a company’s shares to the public.
OFS (Offer-for-Sale): Shares sold by existing shareholders during an IPO.
Quick-Commerce: Fast delivery of essentials, like Swiggy’s Instamart service.
CAGR (Compound Annual Growth Rate): The average growth rate over time, helpful in tracking growth trends.
Retail Investors: Individual shareholders who buy in smaller amounts.
Institutional Investors: Large investors, such as banks or funds, that buy in bulk.
