Swiggy cuts IPO valuation to $11.3 billion amid market volatility

Indian food delivery giant Swiggy (SWIG.NS) has once again reduced its IPO valuation to $11.3 billion, marking a 25% decrease from its initial target of $15 billion.

Swiggy cuts IPO valuation to $11.3 billion amid market volatility

According to two sources on Sunday, this adjustment comes in response to market volatility and Hyundai India's lackluster debut, which has dampened investor sentiment. BlackRock and the Canada Pension Plan Investment Board (CPPIB) are set to invest in Swiggy's $1.4 billion IPO, which will be the second-largest stock offering in India this year. Swiggy, along with BlackRock and CPPIB, did not respond to requests for comment outside of business hours. Indian shares have experienced a downturn for four consecutive weeks, the longest losing streak since August 2023. The benchmark Nifty 50 index has declined by over 8% from the record highs achieved on September 27, mainly due to ongoing foreign selling. Hyundai India's shares fell 7.2% on their debut last week after retail investors reacted tepidly, raising concerns about the company's high valuation. In light of these factors, Swiggy—backed by SoftBank and Prosus—sought to avoid a lukewarm reception for its sizable IPO and decided to lower its valuation after discussions with investors, as one familiar source revealed.

Swiggy aims for successful IPO amid strong competition and robust market

Swiggy aims to avoid a "bad IPO." In its last funding round, led by Invesco in 2022, the company was valued at $10.7 billion. Swiggy competes with Zomato (ZOMT.NS) in India's online food delivery market. Both companies are making significant investments in "quick-commerce," which promises grocery and product deliveries within 10 minutes. Despite recent uncertainties, India's IPO market remains robust. Around 270 companies have raised $12.57 billion so far this year, significantly surpassing the $7.4 billion raised throughout 2023.