Swiggy, a major player in food delivery and quick-commerce, announced it has secured Rs 5,085 crore from anchor investors. This comes just before its initial public offering (IPO) opens for public subscription. The funds were raised from notable investors like New World Fund Inc, Government Pension Fund Global, and others, as per a circular on the BSE website.

Strong Demand from Investors

The allocation of shares to anchor investors indicates robust interest from both domestic and international institutional investors. This positive sentiment is reflected in the shares being distributed to ICICI Prudential Mutual Fund, SBI Mutual Fund, and several other prominent financial institutions. Swiggy has allocated 13.04 crore shares at Rs 390 each to 151 funds.

Of these shares, 5.3 crore were given to 19 domestic mutual funds across 69 investment schemes. The total transaction size amounts to Rs 5,085 crore. The IPO will be open for public subscription from November 6 to November 8, with shares priced between Rs 371 and Rs 390.

IPO Details and Market Context

Swiggy aims to raise Rs 11,327 crore through this IPO. This includes a fresh issue of shares worth Rs 4,499 crore and an offer for sale (OFS) of Rs 6,828 crore. The OFS involves exits or partial exits by early investors like Accel India and Tencent Cloud Europe.

The valuation of Swiggy is estimated at approximately USD 11.3 billion or about Rs 95,000 crore at the upper price band. In comparison, its competitor Zomato went public in July 2021 and currently holds a market valuation of Rs 2.13 lakh crore.

Utilisation of IPO Proceeds

According to draft papers, Swiggy plans to use the proceeds from the fresh issue for various purposes. These include investing in technology and cloud infrastructure, brand marketing, business promotion, debt repayment, and funding inorganic growth along with general corporate purposes.

Founded in 2014, Swiggy reported a loss of Rs 611 crore for the quarter ending June 2024. This is an improvement from the Rs 564 crore loss recorded in the same period last year.