Swiggy, the renowned online food ordering and delivery platform, is set to make waves in the financial market with its upcoming initial public offering (IPO) in November. After receiving the nod from the Securities and Exchange Board of India (SEBI), Swiggy is gearing up for what could be a monumental market debut. Established in 2014 and headquartered in Bangalore, Swiggy has expanded its services to over 580 cities, positioning itself as a heavyweight in the food delivery sector.
Confidential filing strategy
In a strategic move, Swiggy utilised the confidential pre-filing route for its IPO submission on April 30. This approach, introduced by SEBI in November 2022 and akin to practices in the US markets, allows companies to keep their offer documents under wraps until they finalise their IPO details. This method was first adopted by Tata Play in India, although it later withdrew its IPO plans.
Funding goals and market strategy
Swiggy aims to raise ₹11,000 crore through its IPO, planning a fresh issue worth ₹5,000 crore. This substantial funding target underscores Swiggy's ambitious growth plans and its robust backing by major investors like Prosus, SoftBank, and Accel, which have propelled its valuation to $9.3 billion as of August 2023.
Public and celebrity engagement prior to the IPO
In anticipation of its IPO, Swiggy has seen significant interest from various quarters, including high-profile investments. Notably, the family office of Bollywood icon Amitabh Bachchan and Raamdeo Agrawal, chairman of Motilal Oswal Financial Services, have acquired stakes in the company.
Furthermore, recent purchases by entities such as Modern Insulators, which bought 1,38,800 shares at ₹360 per share, highlight the attractiveness of Swiggy as a long-term investment. Prominent individuals like Madhuri Dixit and Ritesh Malik have also invested in Swiggy, securing shares from the secondary market.
Regulatory and public scrutiny phase
Before the official launch of the IPO, Swiggy is required to present its updated draft red herring prospectus (UDRHP) to the public for at least 21 days. This period allows for public feedback on the offer document, which is crucial for the final adjustments before the IPO proceeds. This phase is vital as it ensures transparency and builds trust among potential investors who are considering to invest in IPO.
The potential impact of Swiggy's IPO
Swiggy's IPO is not just a significant event for the company but also for the Indian IPO market, especially following the successful listing of Zomato, another food delivery giant. As Swiggy finalises its IPO details, the opportunity to invest in IPO becomes a focal point for investors aiming to be part of Swiggy's growth story in the burgeoning food delivery sector.
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