Swiggy shares rise 3% as report says firm plans to launch Rs 10,000-crore QIP next week

Swiggy shares rise over 1.5% as report says firm plans to launch Rs 10,000-crore QIP next week

Shares of food and grocery delivery platform Swiggy rose 3% on December 2 after a report said the firm is preparing to raise as much as Rs 10,000 crore from institutional investors as early as next week.

Bloomberg reported, citing sources, that the company has shortlisted three banks to manage the share sale — the Indian units of Citigroup Inc. and JPMorgan Chase & Co., as well as Kotak Mahindra Capital Co.

Swiggy’s board approved plans on November 7 to raise up to Rs 10,000 crore through a qualified institutional placement, subject to shareholder and regulatory approval. The timing and size of the deal could still change, sources told Bloomberg.

At 3 pm on December 2, Swiggy shares on NSE were trading 3% higher at Rs 400.1 apiece.

Swiggy, which owns food delivery and quick commerce businesses, had recently said the external environment is competitive and dynamic, and hence the company's board will consider raising additional funds.

"With the current cash balance to be further bolstered by the Rs 2,400 crore Rapido divestment, we feel comfortable about our overall balance sheet strength, and are well-funded for our growth ambitions," Swiggy said in a letter to shareholders on October 30 post declaring its second quarter results.

"However, the external competitive environment is dynamic, and legacy and new players continue to attract investments to the sector. This has necessitated a conversation with the board to consider additional fundraising, which will give us access to sufficient growth capital while enhancing our strategic flexibility,” it added.