Swiggy, the popular food aggregator and grocery delivery platform, filed its Draft Red Herring Prospectus (DRHP) with SEBI on Thursday, aiming to raise ₹3,750 crore via a fresh issue of shares. The IPO will also include an offer-for-sale (OFS) of 185 million shares by existing investors like Accel, Tencent, Elevation Capital, and Norwest Venture Partners.
Potential Upsizing of Fresh Issue
According to sources, Swiggy is considering increasing the fresh issue component by ₹5,000 crore, which could bring the total fresh issue to ₹11,600 crore. A final decision is expected at an EGM scheduled for the first week of October 2024.
Use of IPO Proceeds
Swiggy plans to use the IPO proceeds for several key areas, including:
– Investment in Scootsy (its subsidiary)
– Expansion of its dark store network for quick commerce
– Technology and cloud infrastructure development
– Funding for inorganic growth
Swiggy’s Impressive Growth Numbers
Swiggy has shown significant growth in recent years. As of June 2024, the company reached a milestone of 112.7 million transacted users.
– Average monthly order frequency for FY24 was 4.50 times, up from 4.34 times in FY23.
– Consolidated operating revenue grew by 36% YoY, reaching ₹11,247 crore in FY24.
– Net loss decreased by 46% to ₹2,256 crore in FY24, compared to ₹4,192 crore in FY23.
Quick Commerce Expansion with Instamart
Swiggy’s Instamart, its quick commerce division, has been a major growth driver. In Q1 FY25, Instamart’s gross order value (GoV) was ₹2,724 crore, marking a 57.6% YoY increase. The segment’s annualized GoV stands at $1.3 billion, already 40% of Swiggy’s food delivery GoV.
Dark Stores Network Expansion
Instamart’s expansion is evident in its growing dark stores network, which saw the addition of 59 new stores in Q1 FY25 alone. As of September 2024, Instamart operates 605 active dark stores across 43 cities in India, a significant increase from 557 stores in 32 cities in June 2024.
