Swiggy increases IPO size: Company to now raise Rs 5,000 crore in fresh issue up from Rs 3,750 crore

Sriharsha Majety. co-founder and Group CEO of Swiggy

Food tech giant Swiggy is set to increase the size of its initial public offering (IPO) by raising additional capital through a fresh issue of shares, according to an internal set of documents seen by Moneycontrol.

The company, which was first expected to raise Rs 3,750 crore (around $450 million) through a fresh issue, will now issue fresh shares worth Rs 5,000 crore (about $600 million), an increase of Rs 1,250 crore or $150 million, as it readies a cash chest in a highly competitive market.

In all, Swiggy was initially expected to raise $1.25 billion through its IPO, Rs 3,750 crore (around $450 million) in fresh issue and up to Rs 6,664 crore (around $800 million) as part of the offer-for-sale (OFS). However, if the company’s board approves the new proposal at its extraordinary general meeting (EGM) on October 3, the total IPO size will be around $1.4 billion, up from $1.25 billion, with the additional $150 million coming in via a fresh issue. There are no plans to change the OFS component yet.

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Since April, when the company first filed its draft IPO papers, rivals like Zomato and Blinkit have improved profitability and increased market capitalisation, too. Investors have flocked to invest in other players like Zepto, which has has raised $1 billion in the past two months and are increasing competitive intensity in the quick commerce space. Larger rivals, like Walmart, have also entered the rapid delivery space through Flipkart Minutes.

Swiggy did not reply to Moneycontrol’s queries. News website Entrackr was first to report the development.

Improved financials 

This also comes at a time when Swiggy, despite lagging rival Zomato on all metrics, has narrowed the gap with the company as seen in its financial year (FY24) performance.

Swiggy’s revenue grew 36 percent from Rs 8,265 crore in FY23 to Rs 11,247 crore in FY24. 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 as ahead of the company’s plans to list on the stock exchanges later this year, Moneycontrol had reported earlier.

Gurugram-based Zomato, in comparison, had a revenue of Rs 12,114 crore (vs Swiggy's Rs 11,247 crore) and clocked a profit of Rs 351 crore (vs Swiggy's loss of Rs 2,350 crore) in FY24.