Swiggy Share Price & IPO Listing Highlights: Swiggy shares surge 10% after listing at premium on NSE, BSE

Swiggy shares jumped 6.43% on the NSE to ₹447 as at 3.02 pm. On the BSE, the stock rallied 8.56% to ₹447.25.

With Swiggy listing on the stock exchanges on November 13 at a premium, the debate intensifies over whether Swiggy or Zomato offers the better investment in India’s booming food delivery market

Investors are keenly comparing Swiggy to its main competitor, Zomato, which has already experienced two years in the public market. Both companies are key players in India’s food delivery industry, valued at approximately $4.5 billion in 2023 and projected to grow at a compound annual growth rate (CAGR) of 25% over the next five years. This analysis compares the financials, growth potential, and strategic directions of Swiggy and Zomato, shedding light on which platform may offer stronger returns.

Market position and financial performance

Both Swiggy and Zomato have carved out significant shares in the Indian market, with Zomato accounting for approximately 55% and Swiggy for about 45% of the market by 2023. However, the companies differ significantly in revenue composition and business models, which influence their respective investment potential.

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Instamart essentially a play on broader retail; has immense potential to grow: We see immense growth potential in Instamart given QC is essentially a play on the broader retail market, which was sized at ~USD 1trln in CY22. While Swiggy tested the dark store-led business model first, sudden rise in competition and better execution by competition did lead to market share erosion. Despite that, in GOV terms, we estimate Instamart was only behind Blinkit as of FY24, with a market share of ~28%. Moreover, the QC channel penetration within the broader retail market even today is barely ~0.35%, compared to ~5-6% e-retail penetration. Even assuming the QC channel penetration will reach only 1.5-2% over the next 5 years, the market can expand at >50% CAGR. This will ensure exponential GOV/Revenue growth for Instamart over the medium term. Moreover, the QC business model has enough operating leverage to turn self-sustainable, when operating at scale.

Swiggy shares traded at ₹443 on the NSE, higher by 5.48% as at 2.17 pm.

On the BSE, the stock climbed 7.91% to ₹444.60.

Swiggy’s listing underscores the dominance of short-term subscribers, evident in the lukewarm participation from Non-Institutional Investors (NIIs) and subdued retail interest. This can be attributed to the company’s higher valuation when compared to its only listed peer, making it challenging for investors to justify any frantic applying in IPO

Despite this, I feel, Swiggy’s sectoral opportunity, its market share, and readiness are undeniable. In principle, the company’s potential warrants attention.

However, considering the prevailing stock market dynamics with respect to Swiggy, it’s advisable to allow the dust to settle. The scrip is currently dominated by traders lacking a clear opinion on the company’s value proposition. The modest listing gain supports this assessment.

Long-term investors should await an opportune time to accumulate Swiggy shares. The company’s December quarter performance will be crucial in backing the issue with tangible numbers. A decent financial reporting will validate Swiggy’s potential as a good long-term hold.

- Tarun Singh Founder & MD, Highbrow Securities

Swiggy Ltd.’s shares climbed in their Mumbai debut, signaling a vote of confidence for large initial public offerings in India.

The food-delivery firm listed at 416.20 rupees, about 7% higher than the selling price of 390 rupees, the top of the marketed range. The shares traded at 444.65 rupees at 11:47 a.m. local time, valuing the company at just under $12 billion. 

The $1.3 billion sale, the nation’s second-largest listing this year after Hyundai Motor India Ltd.’s record $3.3 billion IPO, comes as global funds are dumping local shares on concerns over earnings growth. Initial demand for Swiggy’s IPO was subdued, but institutional demand on the final day drove it to a strong close.

Swiggy’s IPO was seen as a test of investor appetite for the country’s burgeoning quick-commerce sector. The debut pits the company against larger listed rival Zomato and privately-held Zepto in India’s rapid delivery space. According to CLSA, these firms are set to top $78 billion in combined gross orders within a decade.

“These companies already have a good presence and people have gotten used to ordering,” said Pranav Bhavsar, a co-founder of Trudence Capital Advisors Pvt. “It is hard to do away with that once you get used to it. That makes quick commerce a good theme to invest.”

The listing defies the recent trend of weak performance among large first-time offerings in India. IPOs raising over $1 billion since 2019 have fallen by an average 3% on their first trading day, data compiled by Bloomberg show. That compares with an average 19% gain for all listings in the country for the period.

Hyundai Motor India’s shares dipped on debut last month, and remain 12% below the IPO price. A handful more big listings are in the pipeline: state-backed NTPC Green Energy Ltd. is set to take bids for its up to $1.2 billion IPO next week. The Indian unit of LG Electronics Inc. and HDB Financial Services Ltd. are also gearing up for their debuts.

“The India IPO market faces a cautious outlook following Hyundai’s underwhelming post-listing performance,” said Manish Bhargava, chief executive officer at Straits Investment Management in Singapore. “Investor skepticism is heightened, especially for startups with high valuations but uncertain profitability.”

While Swiggy’s IPO attracted global funds including Fidelity International, the loss-making company faces challenges. Competition among quick commerce firms has caught the attention of India’s antitrust watchdog, which is investigating the company and Zomato for alleged unfair practices. Both the firms have said no final order has been issued.

Fierce competition means increased spending on small-sized warehouses while “regulatory actions, such as welfare scheme for gig workers will be inflationary,” Macquarie Group analysts including Aditya Suresh wrote in a note. They initiated coverage with an underperform rating and a target of 325 rupees.

Despite these hurdles, Swiggy’s growth is backed by strong online demand in one of the fastest-growing major economies. Its market share stood at about 37%, just behind Zomato’s 39% as of March 31, according to Chryseum Advisors, which tracks unlisted shares. 

“We see immense growth potential given quick commerce is essentially a play for the broader retail market, which was approximately $1 trillion in 2022,” JM Financial Institutional Securities Pvt. analysts wrote in a note. JM began coverage on Swiggy with a buy rating and a target of 470 rupees.

The company was priced at about 40% discount to Zomato’s 12-month forward enterprise value to sales, according to Bloomberg Intelligence. Zomato shares have more than doubled this year, with nearly all the 27 analysts covering the company recommending the stock as a buy.

“Zomato trading up is providing a strong backdrop to Swiggy’s performance,” said Devi Subhakesan, an independent analyst from Investory Pte. 

Meanwhile, SoftBank Group Corp. and Prosus NV have more than doubled the value of their investments in Swiggy’s listing price. Prosus and its controlling shareholder Naspers Ltd. invested $1.3 billion building a 31% stake in Swiggy ahead of its debut.

Bloomberg input

Swiggy, India’s pioneering on-demand convenience platform backed by Prosus, has today listed on the National and Bombay Stock Exchanges of India (NSE and BSE), valuing the company at US$11.3 billion. Prosus sold shares worth more than US$500 million as part of the IPO.

Prosus has been a cornerstone investor in Swiggy since 2017. Following the IPO, Prosus holds a c25%1 stake and maintains its two seats on the Board.

Fabricio Bloisi, CEO of Prosus, said: “Everyone at Prosus extends huge congratulations to the Swiggy team on today’s IPO. We have supported the management team since our first investment in 2017 and have seen the company flourish in the post-pandemic era. It has diversified into new areas, expanded into new cities, and built an iconic consumer brand – placing Swiggy on a strong trajectory as a public company. Our investment in Swiggy highlights our commitment to building transformational companies and delivering returns for our shareholders by actively managing our portfolio.

“India remains a key growth market for Prosus given the country’s impressive digital transformation in the consumer and enterprise sectors. We are excited about the region and see huge opportunity for value creation including a strong IPO pipeline within our current portfolio.

Swiggy debuted at ₹420, marking a listing gain of 7.6%, which outpaced its grey market premium (GMP) estimate of just 0.26%. Retail investors showed modest interest, subscribing only 1.14 times, indicating low confidence. Current market conditions have kept many investors on the sidelines, especially as numerous high-quality companies remain 15-20% below their all-time highs.

However, for those with a higher risk appetite, Swiggy could be an opportunity to capitalize on the valuation gap between Zomato and Swiggy, with potential gains hinging on Swiggy’s ability to enhance operational efficiency over time.

- Gaurav Garg, Research Analyst at Lemonn Markets Desk

Anand Daniel, Partner at Accel

“As Swiggy hits the public bourses today, we at Accel reflect on the remarkable journey that Harsha, Nandan, and Phani, along with the Swiggy team, have undertaken. Being one of Swiggy’s first partners, when food delivery in India was still emerging, makes today especially meaningful. Guided by our thesis-led approach to food delivery, we were introduced to Harsha and his founding team in 2014—a connection that has since fueled countless innovations. This IPO is a testament to the grit, innovation, and consumer focus that Swiggy has consistently brought to the market. From ultra-fast grocery delivery with Instamart to ensuring safety and access during the pandemic, Swiggy has continually adapted to consumer needs with agility. Today’s IPO marks not only a milestone for Swiggy but a pivotal moment in India’s digital economy, impacting the daily lives of millions.”

Swiggy shares rallied to hit day’s high at ₹449 on the NSE after listing at ₹420 today.

Currently, as at 12.46 pm, the stock trades at ₹441.05, higher by 5.01%.

While on an absolute basis Swiggy offers decent upside, we would prefer Zomato if asked to pick only one due to its superior execution in the past and market leadership across key segments. We, however, suggest that investors play both (preferably with higher weightage for Zomato), as in any case both are likely to be amongst the fastest growing consumption names and could, therefore, outperform the broader market returns.

Despite subdued market mood and sluggish response from overall investors, Swiggy listing surprised the market participants. Positive listing and price holding above its issue price of 390 should be seen as strong demand for the company. This shows investors are positive on the space and fear of missing out factor is holding investors not to miss the sector growth story, similar to ZOMATO post listing trend. 

Post Listing: For allotted investors, HOLD FOR LONG TERM despite knowing short term volatility and competitive pressures in the sector. For non-allottees, we advise to wait and watch for the price to settle and revisit to buy near issue price if we get due to market selloff pressure.

Swiggy, the leading food delivery and e-commerce platform in India, made a decent debut on the stock market, listing at around Rs 420, a 7.6% premium over its issue price of Rs 390. This performance is better than expected, considering the moderate subscription of 3.59 times and the initial muted investor response reflected in the low grey market premium.

The listing reflects a degree of optimism about Swiggy’s long-term growth prospects, driven by its strong brand recognition, extensive network, and dominant position in the food delivery market. However, the company’s continued losses and the challenging market conditions may temper investor enthusiasm in the long term.

Investors should approach Swiggy with a balanced perspective, considering the potential for future growth and the associated risks. Those who are holding it may keep a stop at around the issue price.

​​Swiggy shares​​ surged 6.58% on the NSE to trade at ₹447.65 as at 11.38 am.

On the BSE, the stock climbed 8.65% to ₹447.65

JMFinancial on Swiggy

Initiate Buy with TP of Rs 470

Food delivery – duopoly structure should ensure steady growth and profits

Instamart essentially a play on broader retail; has immense potential to grow

On an absolute basis Swiggy offers decent upside, but we would prefer Zomato if asked to pick only one

Zomato over Swiggy due to its superior execution in the past and market leadership across key segments

Suggest that investors play both (preferably with higher weightage for Zomato), as in any case both are likely to be amongst the fastest growing consumption names

Initiate U-P, TP Rs 325

India’s no-2 consumer app(FD, Quick Com, Out-of-Home), has a clear path to catch up with leader Zomato

Quick Com more complex, with no sustainable economic profits

Expect Group EBIT breakeven in FY28E even with 23% core rev CAGR

Swiggy shares climbed 4.58% on the NSE to trade at ₹439.25 as at 11.05 am.

Swiggy shares list at ₹420 on NSE, and at ₹412 on BSE.

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Shares of Swiggy were listed at ₹412 on the NSE, 5.6% premium against the issue price of ₹390.

Swiggy shares debuted on the NSE at ₹420, at a 7.6% premium over the issue price of ₹390.

Shares of Swiggy debuted 7.7% higher in pre-open trade on Wednesday, after institutional investors led its $1.4 billion initial public offering to be oversubscribed by more than three times last week.

The stock is to be listed at ₹420 on the National Stock Exchange (NSE), compared to its issue price of ₹390.

(NSE handle on X)

Listing of Swiggy Limited on November 13, 2024 

Symbol: SWIGGY 

Series: Equity “B Group” 

BSE Code: 544285 

ISIN: INE00H001014 

Face Value: Rs 1/- 

Issued Price: Rs 390/- per shar

Tencent Holdings Ltd.’s top backer Prosus NV said it has made more than $2 billion on its Swiggy investment as it continues to highlight the value of its portfolio outside of its stake in the Chinese tech giant. 

Prosus and its controlling shareholder Naspers Ltd. have invested $1.3 billion building a 31% stake in Swiggy ahead of its stock market debut in India on Wednesday. The food delivery firm is targeting an initial public offering valuation of up to $11.3 billion.

Prosus will sell down shares in the IPO and retain 25% of Swiggy, similar to its stake in Tencent, Prosus’s Chief Investment Officer Ervin Tu said an interview. The share sale is expected to generate a return of more than $500 million for Prosus, he added.

“We expect to benefit from the upside of the business, and the tailwinds of the fast-growing Indian market in future,” Tu said, noting that Prosus has invested in several Indian companies that could list on public markets. 

Bloomberg report

Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said: “We believe the majority of the investor especially NII’s & retail stayed back on few reason like Negative cash flow business model followed by concern on high competition and ongoing negative market mood. Considering low subscription demand from NII’s & Retail investors followed by market sentiments, there is a very high possibility of flat to negative listing in the range of +or - 5-10% on its issue price.”

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Food tech major Swiggy’s IPO is set to unlock wealth to the tune of ₹9000 crore in employee stock ownership plan (Esop) wealth for its current and former employees, making it one of the largest wealth creation exercises of its kind in India’s startup ecosystem.

Nearly 5,000 current and former employees are set to benefit, with around 500 Swiggy employees to enter the ‘crore-pati’ club when the firm makes its stock market debut, according to sources.

Till date, Swiggy has has distributed ₹500 crore in Esops. In July this year, the company had announced its plan to buy back stocks worth up to $65 million.

This kind of wealth creation by a new-age company is unmatched at this scale apart from Flipkart which hich has undertaken bigger scale of buyback or payouts in the past. In 2023, Flipkart had paid out a total of $700 million to 17,000 employees.

Overall, Flipkart had over five share buybacks worth $1.4-1.5 billion in total over the past years.

Swiggy’s founders and top management of Swiggy were allocated Esops worth nearly worth $271 million in its latest stock ownership plan.

Investors probably won’t give a standing ovation for the e-commerce major’s market debut as they did when rival Zomato went public in 2021. Still, Swiggy can learn from Zomato’s epic stock meltdown the following year and an equally dramatic comeback since then. The best way for Swiggy to close the valuation gap with Zomato is to set clear profitability timeline and stick to the milestone targets. Investors love a good story, but Swiggy should bear in mind that these days, they’re quick to hit the sell button if earnings don’t meet estimates.

Bloomberg input

Food delivery and grocery major Swiggy’s initial public offering has been oversubscribed by 3.59 times after a tepid response in the first two days. 

The qualified institutional buyers (QIBs) portion was booked 6.02 times — the highest, NII portion was booked 41 per cent and the retail investor’s portion was subscribed 1.14 times. The employees’ book was subscribed 1.65 times. 

The ₹11,300-crore IPO comprises fresh capital raise of ₹4,499 crore and an offer for sale (OFS) of 17.51 shares worth ₹6,828 crore. Swiggy IPO price band has been set at ₹371-390 per share. 

The food delivery giant has raised ₹5,085 crore from institutional investors, including Fidelity and Blackrock, with sizeable participation from domestic investors. 

Shares of food delivery and grocery major ​Swiggy ​will be listed at the bourses today. The company has fixed the IPO price as Rs 370, at the upper end of the price band ₹371-390.

The issue, which struggled on the first two days, sailed through with an​ oversubscription of 3.60 times​, thanks to QIB investors. Given the faltering of large IPOs such as LIC and Hyundai India, marketmen expect only a muted listing from Swiggy.

The qualified institutional buyers (QIBs) portion was booked 6.02 times—the highest, and the retail investor’s portion was subscribed 1.14 times. The employees’ book was subscribed 1.65 times. However, wealthy individual investors (NIIs) remain lukewarm to the issue as the portion reserved for them remained undersubscribed at 0.41 times. 

​KS Badri Narayanan of businessline writes​