Former Swiggy employee 'embezzled' Rs 33 crore from IPO-bound company

Swiggy filed its draft IPO papers via the confidential route in April

A former junior employee of IPO- bound Swiggy embezzled Rs 33 crore over "past periods", the Bengaluru-based food aggregator said in its annual report for the financial year 2023-24. Moneycontrol reviewed a copy of the report.

The company asked an “external team” to investigate the matter and filed a "legal complaint" against the former employee.

"The Group, during the current year, identified embezzlement of funds in one of the subsidiaries by a former junior employee amounting to Rs 326.76 million over the past periods..," the company said in the report released on September 4.

"Based on review of the facts discovered during the investigation, the Group has recorded an expense for the aforementioned amount during the year ended March 31, 2024."

Swiggy did not comment on Moneycontrol's detailed queries about the embezzlement.

The company filed its draft papers for an initial public offering through the confidential route on April 26, Moneycontrol had exclusively reported.

Swiggy is looking to raise up to Rs 3,750 crore (around $450 million) through a fresh issue and up to Rs 6,664 crore (around $800 million) as an offer-for-sale (OFS) component in its $1.25 billion IPO later this year, as reported earlier.

The food-delivery company’s revenue grew 36 percent to Rs 11,247 crore in FY24, the annual report said. It narrowed losses to 44 percent from Rs 4,179 crore to Rs 2,350 crore, as it curtailed expenses.

It spent Rs 13,947 crore in FY24, 8 percent lower than the previous year as it cut down its promotion and marketing spending from Rs 2,501 crore in FY23 to Rs 1,851 crore in FY24.

Despite the improving finances, Swiggy lagged its rival Zomato during the year. On a gross order value (GOV) basis – which totaled to around Rs 56,924 crore between the two companies in FY24 – Swiggy had a market share of 43 percent in the food delivery industry and Zomato was the market leader with a 57 percent share in FY24.

"The continued scale-up in the recent years is driven by an upwards momentum witnessed in demand and supply side factors with (around) 14 million users transacting on our platform at a high frequency of (about) 4.5X. Profitability has sharply improved YoY, as the peak of investments in Instamart is behind us and the business continues to grow rapidly; while the relatively more mature Food delivery business is scaling-up profitably," Swiggy said in its annual report, indicating that the peak of its investment into quick commerce is behind it and the bottom line would improve further.