Swiggy IPO launch likely next week: Offer size to key competitors, all you need to know

The much-awaited initial public offering (IPO) of food delivery giant Swiggy Ltd is finally set for launch next week. Bidding for the ₹11,327-crore IPO would begin on November 6, 2024, and close on November 8, 2024.

Here are some of the key details about Swiggy IPO ahead of IPO launch:

Swiggy business model

Swiggy calls itself a new-age, consumer-first technology company offering users an easy-to-use convenience platform accessible through a unified app.

Apart from regular food and grocery deliveries, its platform can be used to make restaurant reservations and event bookings, offer product pick-up/dropoff services, and engage in other hyperlocal commerce activities.

The company has five business segments: Food Delivery, Doneout (out-of-home consumption), Quick commerce under the brand Instamart, Supply chain and distribution (B2B), Platform innovations, and Swiggy One, the subscription model for customers.

Revenue from major segments:

Swiggy Key Financials

The company’s revenue from operations stood at ₹11,247.39 crore, ₹8264.59 crore and ₹5,704.89 crore in FY24, FY23 and FY22 respectively.

In the June quarter of FY25, the company reported a net loss of ₹611 crore compared to a net loss of ₹564.08 crore in the year-ago period.

However, for the entire financial year of 2023-24, Swiggy’s net losses narrowed to ₹2,350.24 crore compared to ₹4,179.3 crore in the preceding fiscal year. The company’s net loss stood at ₹3,628.89 crore in FY22.

Key risks

• The company has incurred net losses in each year since incorporation and has negative cash flows from operations. If it is unable to generate adequate revenue growth and manage expenses and cash flows, it may continue to incur significant losses going ahead.
• If the company fails to retain its existing user base or fails to acquire new users in a cost-effective manner, its business, financial condition and results of operations could be adversely affected.
• Attracting and retaining delivery partners is critical to Swiggy’s business, and failure to do so cost-effectively may adversely affect it.
• If partners on Swiggy’s platform try to pass on increased operating costs to users, users may decrease the frequency with which they interact on the platform and order volumes may decline.
• Also, since Swiggy is a technology company, any actual or perceived cybersecurity, data or privacy breach could interrupt its operations and adversely affect its reputation, brand, business, financial condition and results of operations.

Key competitors

Swiggy operates in a highly competitive hyperlocal industry. The company competes with online food delivery major Zomato, standalone branded food services players, and restaurants that own and operate their delivery fleets in the food delivery segment.

The out-of-home consumption division again competes with players such as Zomato and Eazydiner, online restaurant booking platforms, self-booking, and offline restaurants.

The quick commerce segment, meanwhile, competes with players such as Blinkit (Zomato), Zepto, BB Now (Big Basket), and other retail platforms.

At the end of the June quarter, the company’s total number of Dark Stores under its quick commerce arm, Instamart, stood at 538, compared to its closest rival, Zomato’s 639 stores under the quick commerce arm Blinkit.

Similarly, Swiggy’s Dark Stores network comprised 460 outlets in FY24 compared to 526 Blinkit stores.

Swiggy’s revenue from operations in Q1FY25 stood at ₹3,222 crore, while Zomato’s consolidated revenue for the same period stood at ₹4,520 crore. While Swiggy reported a net loss of ₹611 crore in Q1FY25, Zomato’s net profit in the June quarter stood at ₹253 crore.

Swiggy IPO: Important dates

The allotment for the Swiggy IPO is expected to be finalised on November 11 after bidding closes on November 8.

Swiggy's shares are likely to be listed on the BSE and the National Stock Exchange of India (NSE) on Wednesday, November 13.

Swiggy IPO objectives

The company plans to use the IPO proceeds to repay or prepay loans to its material subsidiary, Scootsy. It will also invest a portion in expanding Scootsy and opening more dark stores under the quick commerce segment. The company will also deploy funds for technology upgrade and cloud infrastructure.