Madhuri Dixit goes dhak dhak for Swiggy, snaps up shares ahead of IPO

Madhuri Dixit and Dr Shriram Nene

Leading Indian actor Madhuri Dixit has picked up shares in food and grocery delivery startup Swiggy ahead of its public market debut later this year, people familiar with the development  told Moneycontrol.

Dixit has bought shares in the secondary market along with Ritesh Malik, founder of Innov8, a co-working space player, now owned by Oyo.

Dixit and Malik together bought shares worth Rs 3 crore, which was also the minimum investment size, by putting in Rs 1.5 crore each and became equal shareholders in Swiggy. The duo, who typically invest together with Dr Shriram Nene (Dixit’s husband), bought shares from the secondary market through transactions that were facilitated by Swiggy’s investment banker Avendus, one of the persons cited above added.

A secondary transaction is where an existing investor sells their shares in a company to an incoming investor directly without the company’s involvement.

Dixit paid Rs 345 for each share of Swiggy, a second person aware of the developments told Moneycontrol.

"We moved from the US where the startup ecosystem was booming to India where startups were just beginning to take shape. Madhuri’s work takes her to mass markets and the consumer space. My work is in health, tech and new media. We have a board of statured advisors and our family office is now actively and selectively participating in the unlisted space. In some cases, the involvement is only financial, in other cases, it is more strategic," Dr Shriram Nene said in a statement to Moneycontrol.

“At this point, we would prefer not to name or discuss any specific company, but the startup ecosystem in India is certainly one of the most interesting in the world due to the unique and diverse nature of India’s consumers and markets,” Nene added, without specifically commenting on the Swiggy investment.

Swiggy declined to comment on the developments.

The Bengaluru-based company is slated to list on the stock exchanges later this year in a massive $1.4 billion (Rs 11,664 crore) IPO which was recently upsized, too. Swiggy’s revenue grew 36 percent from Rs 8,265 crore in FY23 to Rs 11,247 crore in FY24, Moneycontrol had reported earlier. During the same period, its losses were down 44 percent from Rs 4,179 crore to Rs 2,350 crore helped by a stronger control on expenses during the year.

Zomato, in comparison, had a revenue of Rs 12,114 crore and clocked a profit of Rs 351 crore in FY24.

Hedging their bets
Dixit is the second popular Indian celebrity who has snapped up Swiggy shares ahead of its IPO. In August, actor Amitabh Bachchan reportedly picked up shares in the company and became part of a growing list of investors that are looking to diversify beyond Zomato.

Zomato’s shares have been on a tear and are up 120 percent over on a year-to-date (YTD) basis. Gurugram-based Zomato listed on the stock exchanges in 2021 and has become a darling among investors thanks to its stellar performance. Investors that were skeptical about new-age IPOs back then are now looking for a company that can deliver similar returns like Zomato did. Many family officers queuing up  believe Swiggy can also offer outsized returns.

The food delivery market in India is a duopoly with Zomato and Swiggy together commanding about 90-95 percent of the entire industry.

ALSO READ: Swiggy lagged Zomato in food delivery and quick commerce but narrowed gap in FY24

Apart from food delivery, the two companies also compete with each other in quick commerce, a red hot sector in India right now, with Blinkit (Zomato owned) and Swiggy Instamart. The two are top players along with Zepto, Tata Big Basket, Flipkart Minutes and others.

Swiggy shares on the menu

Moneycontrol was first to report about secondary transactions picking up steam ahead of Swiggy’s IPO. Early backers of the company such as Prosus, Accel and Elevation Capital are among the ones selling some shares in Swiggy, as reported earlier.

During secondary transactions Swiggy was valued at $9-9.3 billion and during conversations over the past months, bankers have expressed confidence that Swiggy can list with a market capitalisation/valuation of around $10-13 billion.

For context, Zomato is currently worth over $29 billion.