US-based money manager Baron has marked up the value of its stake in Swiggy to $87.2 million, indirectly ascribing a valuation of $12.16 billion to the hyperlocal commerce unicorn even as it prepares to go for an initial public offer.
The fund house's stake in Swiggy was bought for $76.7 million in early 2022 when the company was valued at $10.7 billion in post-money terms, after a funding round.
The mark-up in Swiggy's valuation also comes at a time when its archrival Zomato has seen its stock price shoot up 58 percent in the last six months on an improvement in profitability and fast growth of its quick commerce arm Blinkit.
Zomato currently has a market capitalisation of $17 billion (Rs 1.39 lakh crore).
Baron's latest valuation of Swiggy was done as of December 31, 2023, when Zomato's market capitalisation was $13 billion (Rs 1.07 lakh crore).
Swiggy is still some distance away from profitability and is said to be lagging behind Zomato in market share.
The IPO-bound company saw its revenue rise 45 percent to Rs 8,625 crore in FY23, while its net loss widened to Rs 4,179 crore.
In the previous financial year, the hyperlocal commerce unicorn had registered a revenue of Rs 5,705 crore and a net loss of Rs 3,629 crore.
For comparison, arch-rival Zomato's revenue had risen 66 percent to Rs 7,761 crore in FY23, while net loss narrowed to Rs 971 crore. Moreover, Zomato has reported positive net profit numbers for the previous three quarters ending December.
Swiggy founder and CEO Sriharsha Mejety told Moneycontrol in Davos earlier this month that the food delivery business has slowed down faster than expected even as companies are penetrating deeper into more geographies. As the business grows at a slower pace, Instamart, the company's quick-commerce business, will be Swiggy's growth driver in the years to come, he said.
In a move to cut costs before the IPO, Swiggy recently laid off 400 employees in a restructuring move. This is the second round of layoffs at the food tech giant. The Bengaluru-based company had let go of 380 employees in January 2023 and even shut its meat marketplace in a bid to lower costs.
The latest cost-cut drive will likely affect around 7 percent of Swiggy's workforce. The company has around 6,000 employees on its payroll.
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