Swiggy IPO - Everything you should know as an investor

Swiggy Limited IPO - Key Offers for Investors

These notes summarize key points about the upcoming Swiggy Limited IPO that investors should consider.

Offered information

• • The IPO involves a fresh issue of equity shares aggregating up to ₹ 44,990 million and an offer for sale of up to 175,087,863 equity shares.
• • The company does not have an identifiable promoter.
• • The allotment also holds a reservation of up to 750,000 equity shares for qualified employees.
• • The company will decide on the minimum price band and minimum bid lot in consultation with the BRLMs and advertise them two working days before the bid/offer date opens.
• • The IPO will be conducted through a book-building process.
• • At least 75% of the total amount of the gross offer will go to Qualified Institutional Buyers.
• • Up to 60% of the QIB portion will be available to anchor investors, of which one-third will be reserved for domestic mutual funds.

Therefore, up to 15% of the net offer will go to the Non-Institutional Bidders, and the retail individual bidders will receive about 10%.

Company Overview

• Swiggy is a leading consumer technology company in India. It provides a unified platform for food delivery, grocery delivery, dining out, and other hyperlocal commerce services.
• Its five business segments are as follows:
• FOOD DELIVERY Out-of-Home Consumption Dineout and SteppinOut
• Quick Commerce (Instamart)
• Distribution and Supply Chain Platform Innovations: Swiggy Genie, Swiggy Minis
• **Swiggy was the first to launch a food delivery platform in India in 2014, and Quick Commerce followed in 2020. This is where, according to the Kantar BrandZ Most Valuable Indian Brands Report 2024, Swiggy leads as the most valuable brand in India's Consumer Technology & Services Platforms category.

Investment Highlights

It offers a strong market position and brand recognition in the booming Indian hyperlocal e-commerce market. High-Frequency Hyperlocal Commerce Leader: Food delivery and quick commerce, among others. Innovation-led culture that is customer-need-based and expands the service offerings.

• Shared application strategy built on a shared user base, delivery network and platform infrastructure.
• Experienced management team with a proven track record of success.

Risk Factors

• Swiggy will begin trading for the first time, so the share price may be unstable.
• The offered price may not be the market price of the shares issued following the listing. So, the shares may never attain an active trading market, or the shares might not be maintained.
• Investors are not allowed to withdraw or reduce their bids after they have submitted them (except for Retail Individual Investors, who can do this until the bid/offer closing date).
• Swiggy does not have an identifiable promoter and, thus, cannot derive any advantage from it.
• The business mainly revolves around the "Swiggy" brand; if its reputation gets blemished, it will derogatorily impact the company.
• The funding requirements of Swiggy and the proposed use of proceeds are based on management estimates and not appraised independently.
• Swiggy is a foreign-owned and controlled company and, as such, falls under Indian foreign investment law, which may restrict it in either its business activities or investments.

Financial Performance-

Details of financial data for the three months ended June 30, 2024 and 2023, and the years ended March 31, 2024, 2023 and 2022 are available in the "Restated Consolidated Financial Information" section of the Red Herring Prospectus.

Some of the key performance indicators used by the company are Swiggy Platform B2C Total Orders, Swiggy Platform B2C GOV, and Swiggy Platform Average Monthly Transacting Users.

• The Red Herring Prospectus has the Non-GAAP Financial Measures section that reconciles KPIs to Ind AS measures. General Valuation The Swiggy IPO offers an attractive investment opportunity within a high-growth space. The company has a strong market, innovative culture, and great leadership which lends itself well towards future success. However, investors should weigh up the associated risk factors. These include a lack of clearly identifiable promoters who provide a company's direction, price volatility, and getting oneself dependent upon other reports as market data sources. An analysis of the Red Herring Prospectus detailing the company's performance with financials and information regarding risk is imperative before the investor makes any investment.