| Price | Lot Size | Issue Date | Issue Size |
|---|---|---|---|
| ₹ 371 to ₹ 390 | 38 | 06h Nov, 2024 – 08h Nov, 2024 | ₹ 11,327.43 Cr |
About Swiggy Ltd IPO
A prominent consumer-first technology firm, Swiggy Ltd. was established in 2013 as Bundl Technologies Private Limited. It provides a centralized convenience platform that connects customers to a wide range of service providers. Customers can explore, choose, order, and pay for groceries, meals, and household goods on the platform, meeting their needs for ordering in, dining out, and cooking at home. Since introducing its meal delivery service in 2014 and its grocery delivery service, Instamart, in 2020, Swiggy has become a significant player in both rapid commerce and food delivery. Easily accessible via a single app, Swiggy also offers product pick-up/drop-off services (Genie), event bookings (SteppinOut), and restaurant reservations (Dineout), establishing itself as a leader in India’s hyperlocal commerce market. Swiggy provides additional value with its discount-based membership program, “Swiggy One,” and payment options, Swiggy Money and Swiggy UPI. Food Delivery, Out-of-Home Consumption, Quick Commerce, Supply Chain and Distribution, and Platform Innovations are the five business segments that make up the company’s business model. Swiggy’s revenue is earned through transaction fees, shipping charges, and other service-related fees that it passes on to its partners. Its scalable and adaptable technological stack makes it possible to quickly integrate new services, increasing user engagement and opening doors for its partners to expand. With an increasing user base, a wide network of partners, and an innovation-led strategy, Swiggy is well-positioned to take advantage of India’s growing online commerce market, making it one of the most valuable brands in the nation.
Objective of the Swiggy Ltd IPO
The company proposes to utilize the net proceeds towards funding the following objects:
- Investment in the Material Subsidiary, Scootsy, for repayment or pre-payment, in full or in part, of certain or all of its borrowings;
- Investment in the Material Subsidiary, Scootsy, for (a) expansion of Dark Store network for Quick Commerce segment through setting up of Dark Stores; and (b) making lease/license payments for Dark Stores;
- Investment in technology and cloud infrastructure;
- Brand marketing and business promotion expenses for enhancing the brand awareness and visibility of its platform, across segments; and
- Funding inorganic growth through unidentified acquisitions and general corporate purposes.
Rationale To Invest In Swiggy Ltd IPO
Pioneers of high-frequency hyperlocal commerce categories driven by an innovation-led culture
Swiggy, a pioneer in India’s hyperlocal commerce market, has established itself as a leader in innovation with a broad service portfolio. Since launching Food Delivery in 2014 and Quick Commerce in 2020, Swiggy has rapidly expanded its offerings to include dining, event bookings, and product pick-up/drop-off services. The company’s ability to scale these services is driven by a technology platform designed for scalability, reliability, and quick integration, enabling Swiggy to rapidly launch and expand services like “Swiggy Mall” and Instamart. Leveraging data analytics, Swiggy provides personalized recommendations to users and helps partners engage effectively through targeted advertising tools. Swiggy’s strategic acquisitions, such as Dineout, strengthen its ecosystem by adding complementary offerings and expanding user touchpoints. Despite its growth, the company has maintained minimal equity dilution (1.36% since inception), focusing on organic growth through innovation. This approach, supported by a data-driven model, creates a self-reinforcing cycle that drives user engagement and enhances user and partners’ value. With its robust platform and sustained growth, Swiggy represents a compelling investment opportunity in hyperlocal commerce.
Swiggy’s unified app and its extensive network of business partners create a rich and seamless user experience that drives increasing user engagement
Swiggy has emerged as a leader in India’s hyperlocal commerce market, becoming one of the most valuable brands in the Consumer Technology & Services Platforms sector. Its unified app integrates various services like food delivery, grocery shopping, and restaurant reservations, which boosts user engagement and loyalty. As of June 2024, over 26% of Swiggy’s Monthly Transacting Users (MTUs) accessed more than one service, highlighting its success in offering a comprehensive user experience. The platform’s wide range of services, combined with its network effects, creates a cycle where more users attract more partners, and more partners attract more users, increasing the overall value of the platform. Swiggy also offers partners cost-effective ways to reach users through targeted ads, personalized recommendations, and an efficient delivery network. With 112.73 million ever-transacted users, Swiggy’s growth is evident in its rising engagement and transaction frequency. Monthly GOV per MTU increases, driven by higher average order values and frequent transactions. Quick Commerce accounts for 40% of Food Delivery’s Gross Order Value. Swiggy’s expanding services, strong user retention, and growing market presence make it a solid investment with significant growth potential.
Valuation of Swiggy Ltd IPO
India’s online food delivery market has expanded from Rs. 112 billion in 2018 to Rs. 640 billion in 2023, with projections to reach Rs. 1,400-1,700 billion by 2028, driven by rising incomes, urbanisation, and shifting lifestyle preferences. Significant growth potential exists with the growing gig economy and increasing demand for convenience, especially in smaller cities. Swiggy Ltd, a leader in hyperlocal commerce, has pioneered online food delivery (2014) and quick commerce (2020), offering food, groceries, and household items through its unified app. The company is well-positioned to capitalise on these emerging opportunities. The company has seen steady growth, reaching 112.7 million Monthly transactional users (MTU) by June 2024, supported by its customer-centric approach and strong brand recognition. While Swiggy has reported losses consistently, it has shown steady growth in its revenue. The management remains confident that its strategy, including expanding its dark store network, optimising logistics, and broadening its product range, will turn operations profitable in the coming years. The company aims to narrow its market share gap with rivals Zomato and Blinkit, accelerating its Instamart service and enhancing customer engagement. Swiggy’s innovation-driven approach positions it for long-term growth in the food delivery and quick commerce segments. Given its strong market presence, strategic expansion plans, and potential for profitability, we recommend a “SUBSCRIBE” rating for the issue with a medium to long-term investment perspective.
What is the Swiggy Ltd IPO?
Swiggy IPO is a book built issue of Rs 11,327.43 crores. The issue is a combination of fresh issue of 11.54 crore shares aggregating to Rs 4,499.00 crores and offer for sale of 17.51 crore shares aggregating to Rs 6,828.43 crores. Login to your account now.
How to apply for the Swiggy Ltd IPO through StoxBox?
To apply for the Swiggy Ltd IPO through StoxBox one can apply from the website and also from the app. Click here
When will the Swiggy Ltd IPO open?
Swiggy Ltd IPO is opening on 06th November 2024. Apply Now
What is the lot size of the Swiggy Ltd IPO?
The Lot Size of Swiggy Ltd IPO is 38 equity shares. Login to your account now
When is the Swiggy Ltd IPO allotment date?
The allotment Date for Swiggy Ltd IPO is 11th November 2024. Login to your account now.
When is the Swiggy Ltd IPO listing date?
The listing Date for Swiggy Ltd IPO is 13th November 2024. Login to your account now
What is the minimum investment required for the Swiggy Ltd IPO?
In the Retail segment the minimum investment required is Rs. 14,820. Login to your account now
What is the maximum investment allowed for theSwiggy Ltd IPO?
In the Retail segment the maximum investment requirement is Rs. 192,660. Login to your account now
What are the risks associated with investing in the Swiggy Ltd IPO?
- Swiggy faces intense competition across its key segments—Food Delivery, Quick Commerce, and Dining Out—against players like Zomato, Blinkit, and others. Competitors may offer lower prices, broader services, or leverage better technology, reducing Swiggy’s market share, impacting margins, and adversely affecting its business growth and profitability.
- Swiggy has faced net losses and negative cash flows since its inception due to significant expenses supporting its growth, such as advertising, delivery, and employee costs. Despite expanding its services (Food Delivery, Quick Commerce, Dineout, Genie), Swiggy has struggled to achieve consistent profitability. The company continues to invest in scaling its operations, adding new offerings, and expanding its user base. Still, risks remain, including slowing demand, increased competition, and higher operational costs, which could hinder future profitability and cash flow growth.
- Swiggy’s Quick Commerce business relies heavily on managing its Dark Stores, which are crucial for product assortment, order fulfilment, and reducing delivery costs. Any issues with location suitability, increasing lease payments, or operational disruptions could negatively impact its financial performance, sales, and fulfilment efficiency.
When will the Swiggy Ltd IPO shares be credited to my Demat account?
The Swiggy Ltd IPO be credited to the account on allotment date which is 12th November 2024. Login to your account now
Where can I find the Swiggy Ltd IPO prospectus?
The prospectus of Swiggy Ltd IPO prospectus can be find on the website of SEBI, NSE and BSE
What are the important dates related to Swiggy Ltd IPO?
| 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 PM on November 8, 2024 |
