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Swiggy Shares Debut at ₹420 on NSE, Up 7.7% Over ₹390 IPO Price

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Synopsis:

Swiggy's shares listed at ₹420 on NSE, up 7.7% from the ₹390 IPO price. The IPO was oversubscribed, with funds earmarked for expansion, tech enhancement, and marketing.

Swiggy Shares Open at Premium in Market Debut

Swiggy shares made a notable market debut, listing at ₹420 on the National Stock Exchange (NSE), reflecting a 7.7% premium over its issue price of ₹390 per share. On the Bombay Stock Exchange (BSE), the shares opened at ₹412, marking a 5.64% increase. The highly anticipated IPO saw substantial interest, especially from qualified institutional buyers (QIBs), demonstrating strong demand and investor confidence. The Swiggy share price was closely watched, with investors eager to see how it performed in its debut.

The ₹11,327.43 crore Swiggy IPO, which was open for subscription from November 6 to November 8, 2024, offered shares within a price range of ₹371-390. The offering closed with a strong 3.59 times subscription, largely driven by QIBs subscribing at 6.02 times. Retail investors subscribed 1.14 times, while non-institutional investors (NIIs) underperformed with a 0.41 times subscription rate.

The IPO comprised a fresh issue of 11.54 crore shares valued at ₹4,499.00 crore and an offer for sale of 17.51 crore shares amounting to ₹6,828.43 crore. As a result, the promoter's shareholding in Swiggy reduced from 63.56% to 52.97%. Ahead of the public listing, Swiggy raised ₹5,085 crore from anchor investors on November 5, 2024. Retail investors were required to make a minimum investment of ₹14,820 for a lot size of 38 shares.

Also Read: Tata Chemicals Europe to Invest ₹655 Crore in UK Sodium Bicarbonate Plant

Strategic Fund Utilization

Swiggy plans to utilize the funds raised through the IPO for multiple strategic purposes. These include investment in its material subsidiary, Scootsy, with aims to repay or partially prepay borrowings. Expansion in Quick Commerce will also be prioritized by establishing new dark stores and managing related lease costs. Swiggy intends to enhance its technology and cloud infrastructure and boost marketing efforts across its service offerings. Additionally, a portion of the proceeds will be set aside for potential acquisitions to support inorganic growth and for general corporate purposes.

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Employee and Investor Participation

To foster employee involvement, Swiggy allocated 7.5 lakh equity shares valued at ₹29.25 crore for eligible employees at a ₹25 per share discount. Of the net offer, 75% was reserved for QIBs, while non-institutional investors (NIIs) and retail investors were allocated 15% and 10%, respectively. The lead book-running managers for the IPO included Kotak Mahindra Capital, Jefferies India, and others, with Link Intime as the registrar.

Also Read: Quality Investment Holdings PCC to Sell 9.43% Stake in PNB Housing Finance

Operational Expansion and Future Plans

Since its inception in 2014, Swiggy has established itself as a leading player in the food delivery and Quick Commerce segments through its Instamart service. By September 2024, the platform had expanded to operate 605 active dark stores across 43 cities, offering a wide range of grocery and household items. Swiggy’s Instamart service ensures efficient home delivery via a robust network of delivery partners.

In terms of financials, Swiggy reported a net loss of ₹611.10 crore on a revenue of ₹3,310.11 crore for the quarter ending June 30, 2024. For the fiscal year ending March 31, 2024, the company posted a net loss of ₹2,350.24 crore, with total revenue reaching ₹11,634.35 crore. The Swiggy share price reflects investor interest and optimism as it looks to expand its footprint further in India.

Swiggy's successful market debut underscores a key milestone in its growth trajectory. With the raised capital, the company is well-positioned to strengthen its market presence and drive further innovation, aiming to stay competitive in India’s dynamic Quick Commerce and food delivery sectors.

Also Read: Federal Bank Raises ₹1,500 Crore in Maiden Infrastructure Bond Issuance

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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