The new Swiggy IPO is evoking expectations: what can investors expect?

Swiggy is prompting whispers that it is preparing to go public, after changing its name from a private limited company to a public limited company. Swiggy Limited has now changed to Swiggy Private Limited in the food delivery sector.

It is common practice for a company to change its incorporation from a PLC to a PLC before the initial public offer (IPO) takes place. In February this year, Swiggy's holding company, Bundl Technologies Pvt Ltd, changed its name to SWIGGY Pvt Ltd

While the company has remained mum about its IPO plans, recent market reports indicate that Swiggy, a food aggregator that competes with Zomato in India, is expected to launch its IPO by the end of this year.

Market reports suggest that Swiggy's initial public offering (IPO) will be worth US$1 billion (Rs. 8,300 crores at current exchange rates) and that the company will file a draft list of shareholders with Sebi (the capital market regulator) in the next few months. The price of Swiggy's IPO and the date of its launch will be announced once the company submits its draft list of shareholders to Sebi. This list will include details about the number of shares offered in the fresh issues or any Other Offered Securities (OFS) component. The date of the Swiggy IPO will also be announced this year.

Zomato, which competes with Swiggy, went public in 2021 through an initial public offer (IPO). The share issue was Rs. 9.375 crore, followed by an OTC share issue for Rs. 9.000 crore, with the price band for the share issue being Rs.72-Rs.76. Invesco, an asset management firm, has boosted Swiggy's IPO plans by raising the company's valuation. In its SEC filings, the company stated that Invesco has increased Swiggy "to US$12.7 billion," which is higher than the US$700 million it raised in 2022. At that time, Swiggy was valued at US$10.7 billion, having raised funds from various investors. However, the company later downgraded its valuation to US$7.8 billion as of 2023.

Swiggy is in the process of improving its financial position ahead of its IPO. The company is cutting costs to reduce cash burn. Swiggy is also reducing its headcount in its corporate and call center units. Last week, the company appointed Titan's Watch and Wearables Division Chief Executive Officer as an Independent Director to serve as its Chief Executive Officer. Swiggy had an operating revenue of US$992 million in FY2023 and a loss of US$501 million. In FY2023, the company had a total revenue of US$1.02 billion and a loss of approximately US$207 million in the nine months ending December 2023.