[Updated] Swiggy’s initial public offering (IPO) had a slow start on November 6, the first day of bidding, with only 11% of the shares subscribed. The IPO received bids for 1.77 crore shares out of the 16.01 crore shares available, according to exchange data.
According to BSE data, retail investors led the way, purchasing 52% of the shares reserved for them. Non-institutional investors only bought 0.05 times their allotted shares, while employees subscribed to 70% of their portion. Meanwhile, Qualified institutional buyers (QIBs) showed the least interest in Swiggy’s INR 11,324 crore IPO, with their shares still unsubscribed.
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Swiggy‘s IPO started quietly today, even though the primary market was buzzing with benchmark equity indices opening in green. By 12 PM on the first day of bidding, Swiggy received bids for 98.87 lakh shares out of 16.01 crore shares on offer.
Employee reserved portion sees 0.44X subscription, retail 0.29%
Notably, the highest interest seen in Swiggy’s IPO came from its employees where the employee reserved portion fetched 0.44 times subscription. They received bids for 3.27 lakh shares out of 7.50 lakh reserved for them. The retail investor saw 85.37 lakh shares being placed at the counter for 2.89 crore shares it offered, thus getting a subscription of 0.29 times.
Continue Exploring: Swiggy secures INR 5,085 Cr before IPO, issues 13.03 Cr shares
On the first day, non-institutional investors (NIIs) showed little interest, bidding for only 10.22 lakh shares out of the 4.34 crore shares reserved for them, resulting in just 2% subscription. The shares reserved for qualified institutional buyers (QIBs) have not yet been booked.
Swiggy secures INR 5,085 Cr before IPO
Before its IPO, the company led by Sriharsha Majety raised INR 5,085 Cr from anchor investors on November 5. Swiggy has priced its public issue between INR 371 and INR 390 per share. At the higher end, it aims to raise INR 11,324 Cr from the IPO. Swiggy’s shares are currently trading at a grey market premium (GMP) of INR 12, which is 3% above the issue price.
Continue Exploring: Swiggy’s $11.3 Bn IPO Opens on November 6
Furthermore the company has increased the fresh issue part of its IPO to INR 4,999 Cr, while slightly reducing the offer for sale (OFS) to 17.5 Cr shares. Early investors, Accel India and Elevation Capital, are expected to gain over 34 times their investment by selling some of their shares in Swiggy. The company is now aiming for a valuation of $11.3 billion for its IPO, which is 26% less than the $15 billion it had initially targeted. Swiggy’s shares are set to be listed on the BSE and NSE on November 13.
Meanwhile, the analysts of SBI Securities and Bajaj Broking have given a ‘subscribe’ rating to Swiggy’s IPO for long-term investment. Bajaj Broking said in its IPO note, “While comparing with Zomato, the issue appears to be fairly priced on all these parameters. We recommend investors to subscribe to the issue for a long term investment perspective.”
Interestingly, Swiggy is going public even though it is still losing money. Meanwhile, its main competitor Zomato is already profitable and surpasses Swiggy in most metrics in food delivery, quick commerce, and going-out services.