Swiggy IPO filing likely this weekend, say sources

The company’s IPO, which was earlier expected to be $1.25 billion in size, has been increased to $1.4 billion now

Food and grocery delivery startup Swiggy is likely to file its draft red herring prospectus (DRHP) this weekend, according to people close to the developments.

The approval for its confidential filing from the market regulator Sebi is almost through, paving the way for its DRHP, one of the sources above said.

Once it files the DRHP, the company's management will take part in investor roadshows in the coming weeks across India, US and Singapore. Swiggy's public issue is one of the most anticipated this year, amid a rush of new age economy IPOs that have taken advantage of a thriving bull market.

"The time gap between a DRHP and RHP for a confidential filing is typically lesser as the market Regulator has already gone through the information," said a source.

Swiggy did not immediately respond to queries seeking comments.

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

Swiggy recently upsized its IPO to $1.4 billion, amid intensifying competition in the online grocery delivery space, where its platform Instamart competes with the likes of Zomato-owned Blinkit, Zepto and Tata-owned BigBasket.

Further, India’s food delivery market, which is estimated to grow to Rs 2 lakh crore by 2030, is a duopoly with Swiggy and Zomato together commanding over 90 percent of the food industry.

While Zomato went public in 2021, Swiggy is set to join its rival in the coming months.

Prosus (32 percent), SoftBank (8 percent), Accel (6 percent) are key investors in Swiggy. Elevation Capital, DST Global, Norwest, Tencent, Qatar Investment Authority (QIA), Singapore’s GIC, among several others are other shareholders in the company.

The company was valued at $10.7 billion when it last raised funds in January 2022. However, over the past months, bankers have expressed confidence that Swiggy can list with a market capitalisation/valuation of around $10-13 billion, sources had earlier told 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 earlier set 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, once 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.

The change came days before Swiggy filed its DRHP. Moneycontrol was first to report about Swiggy filing its draft IPO papers with the capital markets regulator, via the confidential route, back on April 26.

Since April, Swiggy has seen increased action in the secondaries market. Company shares have been changing hands at about Rs 330-350 apiece, Moneycontrol had earlier reported. HNIs and family offices have been buying shares in the company which was valued at $9-9.3 billion during secondary market transactions.