IPO-bound food and grocery platform Swiggy is close to finalizing a deal to sponsor the fourth season of Shark Tank India for 25 crores. Swiggy has stipulated as part of the agreement that Zomato founder and CEO Deepinder Goyal not return to the show as an investor, according to sources familiar with the matter. Swiggy’s bid to block Deepinder Goyal from Shark Tank underscores the intensifying rivalry between the two companies, which compete in food and grocery delivery.While they were evenly poised till a few years ago, Zomato has widened the gap in recent years and now has a clear lead over Swiggy in both businesses. It also highlights Swiggy’s growing marketing expenses, as it gears up for public listing in weeks from now.
Swiggy in its updated DRHP had said that of the Rs 3,750 crore that it plans to raise, Rs 950 crore will go towards brand marketing and awareness, as the company looks to expand its reach and tap more customers. Swiggy, Zomato and Sony Television did not offer comments for this story.
Goyal on Shark Tank
Shark Tank India, which airs on Sony Television recently began shooting for the fourth season. The returning sharks include Anupam Mittal of People Group; Aman Gupta of boAt Lifestyle; Namita Thapar, Executive Director at Emcure Pharmaceuticals, Peyush Bansal of Lenskart; and Ritesh Agarwal of OYO.
Deepinder Goyal, who made his debut as a Shark on season 3, earned praise from viewers for his sharp questions and candid observations while interacting with founders who were pitching to him. Social media was abuzz with his comments and clips from the show, burnishing his popularity on the show.
Many companies typically ask for a ‘competition block’ while entering into sponsorship agreements. However, Swiggy’s move to keep out Goyal may have also been prompted by its upcoming public issue.Zomato, which went public three years ago, has had a dream run at the bourses so far, with its market cap nearing $30 Billion in recent weeks.
Swiggy’s DRHP
Swiggy has filed its first updated draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) on September 26.
The fresh issue component is for Rs 3,750 crore while the offer for sale would comprise 18.53 crore shares. Assuming the recent price of share purchases at around Rs 350 apiece, the OFS component will be around Rs 6,500 crore.
Swiggy’s shareholders have also approved the resolution to increase the size of primary issue of its IPO from Rs 3,750 crore to Rs 5,000 crore at the Extraordinary General Meeting (EGM) held on October 3.
The company has created a provision for a larger IPO and the size will be increased by Rs 1,250 crore if the company requires additional funds. To be sure, only the size of primary issue has been increased from Rs 3,750 crore to Rs 5,000 crore. The offer for sale (OFS) component remains unchanged.
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. Zomato, in comparison, had a revenue of Rs 12,114 crore and generated a profit of Rs 351 crore in FY24. In Q1FY25, however, Swiggy prioritised growth because of which losses widened.
Swiggy saw its losses widen 8 percent to Rs 611 crore in Q1FY25 from Rs 564 crore a year ago on mounting expenses, the company’s updated draft red herring prospectus (DRHP) showed.
The company spent Rs 3,908 crore in the three months, up 27 percent from Rs 3,073 crore spent during the same period in the previous fiscal.
Swiggy’s revenue from operations stood at Rs 3,222.2 crore in the April-June period of the current fiscal year, an increase of 35 percent from Rs 2,389.8 crore recorded in the corresponding period of the previous year. In comparison, its listed rival Zomato had a revenue of Rs 4,206 crore (74 percent growth year-on-year) and generated a profit of Rs 253 crore in Q1FY25.
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