Swiggy IPO Set for Market Debut Today: Does GMP Point to a Strong Start?

Swiggy’s shares are poised to debut on Dalal Street today, with investors hopeful for potential gains. The company’s initial public offering (IPO) garnered decent investor interest, with the public issue allotment completed on Monday.

The Swiggy IPO was subscribed 3.59 times overall by November 8, with the retail segment showing moderate demand at 1.14 times. However, the qualified institutional buyers (QIB) category saw strong interest, subscribing 6.02 times, while the non-institutional investor (NII) segment had a lower subscription rate of 0.41 times.

With a price band set between Rs 371 and Rs 390, Swiggy aims to raise Rs 11,327 crore, including a fresh issue of Rs 4,499 crore and an Offer for Sale (OFS) component of Rs 6,828 crore.

What Does the Latest GMP Suggest?

While Swiggy’s IPO was initially expected to perform well, the current grey market premium (GMP) signals a modest start. Initially, the GMP was Rs 22, but it has now dropped.

As of 5:03 AM on November 13, the GMP stands at Rs 1, indicating a listing price of around Rs 391 (the upper price band plus the GMP), reflecting a modest potential gain of just 0.26% per share.

Shivani Nyati, Head of Wealth at Swastika Investmart, explained that although the IPO received a decent subscription, the current GMP of Rs 1 suggests muted investor sentiment. This subdued response may stem from the company’s ongoing losses, despite steady revenue growth.

“While the IPO’s valuation seems reasonable on certain metrics, the negative earnings present a challenge. Moreover, the volatile market conditions could impact the listing performance. A cautious approach is recommended, and investors with a high-risk appetite and a long-term outlook may consider the IPO, but they should be aware of the risks due to the company’s financial position and broader market uncertainties,” Nyati advised.