New Delhi: After Hyundai’s IPO in October, investors were eagerly waiting for Swiggy’s IPO. This IPO with an issue size of more than Rs 11 thousand crore will open on 6th November next month. Investors will be able to bid for it till November 8. But good news is not coming from the gray market for investors. You will be able to invest in Swiggy’s IPO from November 6 to November 8. Allotment will take place on 11th November. Its listing is expected to happen on November 13. Its price band is between Rs 371 to Rs 390. There are 38 shares in one lot. For this, Rs 14820 will have to be invested. A retail investor will be able to buy a maximum of 13 lots.
The issue size of the company is Rs 11327.43 crore. The company will issue 11.54 crore fresh shares worth Rs 4499 crore. Under OFS (Offer for Sale), 17.51 crore shares worth Rs 6828.43 crore will be issued.
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What will the company do with this amount?
The company will use the proceeds from the IPO to invest in its material subsidiary Scootsi. Besides, this amount will also be used in technology and cloud infrastructure. Apart from this, the company will also use the money received from IPO for brand marketing and other works.
What is the situation in the gray market?
Swiggy’s IPO price in the gray market opened at GMP (grey market premium) of Rs 25. This was 6.41 percent more than its issue price. In such a situation, it was expected to be listed at Rs 415.
A day later i.e. on Wednesday it declined. Its GMP fell to Rs 18. In such a situation, its estimated listing price has come down to Rs 408 (4.62 percent).
Will the situation be like Hyundai?
The issue size of Hyundai’s IPO last month was more than Rs 27 thousand crore. Its position in the gray market was not good. Its listing was also not good. In such a situation, investors fear that its condition may also become like that of Hyundai.
However, according to experts, it would be too early to say so. This IPO is not open yet. In such a situation, it is difficult to predict whether its listing will be as per the expectations of the gray market. It is not necessary that the listing of the IPO should be at a premium to the price prevailing in the gray market.
Time.news Interview: Exploring the Upcoming Swiggy IPO
Editor (Time.news): Good morning, and thank you for joining us today. We have the pleasure of speaking with Ravi Sharma, a financial analyst with deep insights into tech IPOs. Ravi, let’s dive right in. Swiggy’s IPO is around the corner, set to open on November 6th. What are your initial thoughts on this launch?
Ravi Sharma: Good morning, and thank you for having me. Swiggy’s IPO is certainly generating a lot of buzz in the market, especially after the successful launch of Hyundai’s IPO. With an issue size of over Rs 11,300 crore, it marks a significant moment for the company and reflects investor confidence in the food tech sector.
Editor: Absolutely. The issue size is substantial. Can you elaborate on the expected pricing and what that means for retail investors?
Ravi Sharma: Sure! The price band for Swiggy’s shares is set between Rs 371 to Rs 390, which is quite competitive considering its market position. A retail investor can purchase a maximum of 13 lots, which means an investment of around Rs 14,820 for one lot of 38 shares. This presents a good opportunity for retail investors, although they should watch the gray market indicators, which are not as optimistic right now.
Editor: Speaking of the gray market, how do you interpret the current sentiments of investors?
Ravi Sharma: The gray market often reflects the primary market’s expectations. If we’re seeing less enthusiasm in the gray market, that might indicate cautious sentiment among investors. It could stem from concerns about valuations or broader market conditions. Investors should remain informed and not rush into decisions based solely on initial excitement.
Editor: That’s insightful. Moving on, can you shed some light on the company’s financial structure regarding the IPO?
Ravi Sharma: Certainly! The IPO will consist of both fresh shares and an Offer for Sale (OFS). Swiggy plans to issue approximately 11.54 crore fresh shares worth Rs 4,499 crore, while the remaining amount will come from the OFS. This infusion of capital is critical for Swiggy’s expansion efforts, especially as the competition in the food delivery sector grows.
Editor: With competition rising, what do you believe Swiggy’s strategy should be post-IPO to maintain its market position?
Ravi Sharma: Post-IPO, Swiggy should focus on leveraging the funds raised for technological innovation, enhancing customer experience, and expanding its broader delivery ecosystem. Strengthening partnerships with local restaurants and improving logistics efficiency will also help them maintain a competitive edge.
Editor: Very true. Lastly, can you forecast what investors should keep an eye on leading up to and after the listing on November 13th?
Ravi Sharma: Investors should monitor market conditions closely, along with Swiggy’s quarterly financial performance and user growth metrics. Additionally, any strategic announcements regarding partnerships or technological advancements will be key indicators of growth potential. It’s also wise for investors to have a balanced portfolio approach given the inherent risks associated with IPO investments.
Editor: Great advice, Ravi. Thank you for this engaging discussion and your valuable insights on the upcoming Swiggy IPO. It’s certainly a topic to watch for both retail and institutional investors.
Ravi Sharma: Thank you for having me. I’m excited to see how this unfolds!
Editor (Time.news): And to our readers, stay tuned for further updates as we approach the Swiggy IPO date. Happy investing!