Swiggy cuts valuation target for IPO to $12.5-$13.5 billion

Indian food delivery giant Swiggy is internally aiming for a company valuation of $12.5 billion-13.5 billion for its upcoming IPO, cutting its target by 10-16% due to market volatility, two people with direct knowledge said on Thursday.

Swiggy was earlier targeting a $15 billion valuation for its $1.4 billion November IPO which will be the country's second biggest stock offering this year, behind Hyundai India's debut this week.

Recent market volatility and a correction in Indian stock markets have prompted Swiggy to consider a lower valuation, as it wants to ensure "a lot of value is left on the table" for investors who bid, said the first source with direct knowledge of the matter.

India's benchmark Nifty 50 index is on course to log four straight weeks of losses, having dropped 7.15% from record high levels hit on Sept. 27, due to persistent foreign selling.

Hyundai India shares fell 7.2% on their market debut on Tuesday after retail investors gave a lukewarm reception amid concerns about a lofty valuation and an auto industry slowdown.

The two sources said Swiggy is expected to list on Nov. 13 on Mumbai bourses, and open the IPO for subscriptions in the week before that, though the date could change slightly.

Swiggy, which is backed by SoftBank and Prosus, did not respond to requests for comment.

Despite recent jitters, India's IPO market has been buoyant with around 270 companies raising $12.57 billion this year already, eclipsing the $7.4 billion raised in all of 2023.

Swiggy plans to conduct roadshows for its stock offering in many Indian cities starting Oct. 30, said the second source.

Swiggy competes with Zomato in India's online restaurant and cafe food deliveries sector, and both have made major bets on the new so-called quick commerce boom where groceries and other products are being delivered in 10 minutes.

Swiggy's last funding round, led by Invesco in 2022, valued it at $10.7 billion.