Key Details of the Swiggy IPO
Price Band and Lot Size
The price band for the Swiggy IPO has been fixed between ₹371 and ₹390 per share. Investors can apply for a minimum of 38 shares, making the minimum investment amount for retail investors approximately ₹14,820. For non-institutional investors (NIIs), the minimum investment requirement is 14 lots (532 shares), totaling around ₹207,480.
Important Dates
- IPO Opening Date: November 6, 2024
- IPO Closing Date: November 8, 2024
- Allotment Date: Expected by November 11, 2024
- Listing Date: Scheduled for November 13, 2024
Financial Highlights
Swiggy’s financial performance shows promising growth despite recent losses. For the fiscal year ending March 31, 2024, the company reported revenues of ₹11,247 crore, marking a 36.1% increase from ₹8,264.59 crore in the previous fiscal year. However, it also reported a loss of ₹2,208 crore, down from ₹4,275 crore in fiscal 2023.In the quarter ending June 2024, Swiggy generated revenues of ₹3,222.2 crore, with food delivery contributing significantly to its earnings.
Use of Proceeds
The funds raised through the IPO will be utilized for various purposes:
- Expansion of dark store network: ₹1,178.7 crore
- Investment in technology: ₹703.4 crore
- Brand marketing and promotion: ₹1,115.3 crore
- Repayment of borrowings: ₹164.8 crore
- General corporate purposes
Market Position and Competition
Founded in 2014, Swiggy has expanded its operations beyond food delivery to include grocery shopping and household essentials through its Instamart service. The company operates approximately 605 dark stores across 43 cities, supporting its quick commerce business.However, Swiggy faces stiff competition from Zomato, which has outperformed it in revenue and profitability metrics recently. Zomato reported revenues of ₹4,206 crore in the April-June period compared to Swiggy’s ₹3,222.2 crore.
Risks Involved
Investors should be aware of several risks associated with investing in Swiggy’s IPO:
- The company has yet to achieve EBITDA positivity.
- Intense competition from Zomato and other players could impact market share.
- The need to retain delivery partners and restaurant partners is critical for operational success.
- The ability to pass on rising operational costs to customers without affecting order volumes remains uncertain.
Conclusion
Swiggy’s IPO represents a significant opportunity for investors looking to engage with one of India’s most prominent food delivery services. While the financial metrics show growth potential, investors should weigh the risks carefully before making investment decisions.
Disclaimer: This article is intended for informational purposes only and should not be considered as financial advice. Readers are encouraged to consult with financial advisors before making any investment decisions regarding the Swiggy IPO or any other financial instruments.
