Indian food delivery giant Swiggy has slashed its IPO valuation again, to $11.3 billion, 25 per cent below the initial goal of $15 billion as market volatility and the lacklustre debut of Hyundai India weigh on sentiment, two sources said on Sunday.
BlackRock and Canada Pension Plan Investment Board (CPPIB) will invest in the $1.4 billion IPO, which will be the country’s second-biggest stock offering this year, the sources told Reuters.
Swiggy, Blackrock and CPPIB did not immediately respond to requests for comment outside business hours.
- Also read: Swiggy launches XL Fleet to cater to bulk orders in the festival season
Indian shares have fallen for four weeks in a row, the longest such losing run since August 2023, with the benchmark Nifty 50 index down more than 8 per cent from record highs hit on Sept. 27, due to persistent foreign selling.
Hyundai India shares fell 7.2 per cent on their debut last week after retail investors gave a lukewarm reception amid concerns about a lofty valuation.
Swiggy, backed by SoftBank and Prosus, was concerned to avoid a tepid response to its relatively large IPO, coming amid global uncertainty from the Nov. 5 U.S. presidential election, and decided to cut the valuation in consultation with investors, said one source, with direct knowledge of the company’s plans.
Swiggy does not want a “bad IPO”, this person said. Its last funding round, led by Invesco, valued it at $10.7 billion in 2022.
It competes with Zomato in India’s online restaurant and cafe food deliveries sector, and both have made major bets on a boom in “quick-commerce,” where groceries and other products are delivered in 10 minutes.
Despite recent jitters, India’s IPO market has been buoyant, with around 270 companies raising $12.57 billion so far this year, well above the $7.4 billion raised in all of 2023.