Swiggy Ltd’s much-anticipated IPO opened for bidding on November 6, 2024, and will be available for subscription until November 8. The food delivery giant has set a price range of ₹371 to ₹390 per share, aiming to raise ₹11,327.43 crore through a mix of new share issues and an offer for sale (OFS). Despite Swiggy’s status as one of India’s top food delivery platforms, early interest from investors has been modest. The Grey Market Premium (GMP) for Swiggy shares stands at ₹11 per share, unchanged since the IPO launch. Analysts attribute this flat GMP to recent volatility in the Indian stock market, which experienced selling pressure ahead of Swiggy’s IPO. However, some analysts remain optimistic that Swiggy’s GMP could improve if market conditions stabilize.
Current Subscription Status
As of 10:45 a.m. on November 7, the second day of bidding, Swiggy’s IPO has seen overall subscription at 0.15 times. The retail portion is subscribed 0.68 times, while the non-institutional investor (NII) segment shows weaker interest, with only 0.09 times subscription.
Financial Performance Highlights
Swiggy has demonstrated notable revenue growth, though it continues to post losses. The financial performance from FY22 through Q1 FY25 reveals this trend:
- FY22: Total income of ₹6,119.78 crore, with a net loss of ₹3,628.90 crore.
- FY23: Revenue rose to ₹8,714.45 crore, though losses increased to ₹4,179.31 crore.
- FY24: Revenue reached ₹11,634.35 crore, with net losses reduced to ₹2,350.24 crore.
- Q1 FY25: Swiggy reported income of ₹3,310.11 crore, with a net loss of ₹611.01 crore.
While Swiggy’s revenue has been on a steady upward trajectory, the persistence of financial losses raises concerns for some investors.
Analyst Views and Recommendations
Several market analysts have flagged Swiggy’s consistent losses and negative cash flow as potential risks. Bajaj Broking advises caution, citing the company’s negative cash flows and lack of profitability. Meanwhile, Aditya Birla Capital expressed concerns about Swiggy’s valuation, which, at a price-to-sales multiple of 7.7 for FY24, seems high even after a valuation adjustment. They recommend avoiding the IPO due to the ongoing losses and elevated valuation.
Key IPO Dates
- Subscription End Date: November 8, 2024
- Allotment Date: Expected on November 9, with a possible extension to November 11 if there are delays
- Listing Date: Expected on November 13, 2024, on both the BSE and NSE
Investors have until November 8 to make their final decisions about participating in Swiggy’s IPO, weighing the company’s growth potential against its financial challenges.
Disclaimer: This information is for educational purposes only and should not be considered financial advice. Investors should conduct their research and consult financial professionals before investing. The performance of past IPOs does not guarantee future results.
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