Swiggy IPO Set to Launch: Key Details, Investor Sentiment, and Expected Listing Price

Swiggy, a prominent food delivery and quick-commerce company, is set to open its Initial Public Offering (IPO) on Wednesday, November 6, closing on Friday, November 8. The price band for Swiggy’s IPO is fixed at Rs.371 to Rs.390 per equity share, each with a face value of Rs.1. The anchor investor allocation will be finalized on Tuesday, November 5.

About Swiggy and its Services

Swiggy provides an integrated, user-friendly app platform where customers can order food, groceries, and other essentials. With services like Food Delivery and Instamart, Swiggy makes it convenient for users to browse, order, and pay for items, which are then delivered through an extensive network of on-demand delivery partners.

Market Sentiment and Grey Market Premium

According to Bloomberg, Swiggy’s IPO could mirror the performance of other large-scale IPOs in India. Historically, IPOs exceeding $1 billion often struggle to show substantial gains on the opening day. Swiggy’s $1.3 billion IPO may follow suit, with its grey market premium (GMP) currently at Rs.25, or roughly 6% above the IPO’s upper price band of Rs.390. Based on this premium, Swiggy’s anticipated listing price is estimated at around Rs.415, a modest 6.41% gain.

Factors Affecting Investor Sentiment

Investor caution could stem from recent market performance. For example, Zomato’s shares declined by 17% over the past month, and Hyundai Motor India’s lackluster IPO results have also led some retail investors to reevaluate their positions. However, Swiggy’s GMP trends over the past eight sessions suggest some optimism, showing upward movement with a high of Rs.25.

Swiggy IPO Structure and Shareholder Details

Swiggy’s IPO structure includes a fresh issue of shares valued at Rs.4,499 crore, along with an Offer for Sale (OFS) of 175,087,863 shares. Major stakeholders selling in the OFS include Accel India IV (Mauritius) Ltd, Apoletto Asia Ltd, Alpha Wave Ventures, Coatue PE Asia XI LLC, DST EuroAsia V B.V., Elevation Capital V Ltd, MIH India Food Holdings B.V., and Tencent Cloud Europe B.V.

Allocation of IPO Funds

Swiggy plans to utilize the IPO proceeds primarily to strengthen its quick-commerce subsidiary, Scootsy, reduce debt, expand its network of dark stores, and cover related lease expenses. Additional funds will go toward enhancing its technology infrastructure, cloud-based systems, and brand marketing. The company also aims to support future acquisitions and overall corporate needs with these funds.

Key Managers and Registrar

Kotak Mahindra Capital Company, Citigroup Global Markets India, Jefferies India, Avendus Capital, J.P. Morgan India, BofA Securities India, and ICICI Securities are the lead managers for the IPO. Link Intime India Private Ltd serves as the registrar.

Also read: Sagility India IPO to Open for Subscription Next Week

Swiggy’s IPO is anticipated with a degree of caution as it joins a mixed landscape for large IPOs in India. With its strong brand and extensive delivery network, Swiggy hopes to appeal to investors looking for growth in the quick-commerce space, despite challenges from recent market trends.