India’s food delivery giant Swiggy has revised its initial public offering (IPO) valuation downward to $11.3 billion, a 25% reduction from its initial target of $15 billion. This move comes as market uncertainty and the underwhelming debut of Hyundai India weigh heavily on investor sentiment.
According to sources familiar with the matter, BlackRock and the Canada Pension Plan Investment Board (CPPIB) are set to invest in the $1.4 billion IPO, which will be India’s second-largest stock offering this year.
Swiggy’s decision to cut its valuation was made in consultation with investors, citing concerns about a lukewarm response to the IPO amid global uncertainty surrounding the November 5 US presidential election. A source with direct knowledge of the company’s plans revealed that Swiggy aimed to avoid a disappointing IPO, having witnessed the tepid reception of Hyundai India’s shares last week.
Hyundai India’s debut saw a 7.2% decline, sparking concerns about lofty valuations. India’s benchmark Nifty 50 index has also experienced a four-week losing streak, its longest since August 2023, with foreign selling persisting.
Swiggy, backed by SoftBank and Prosus, had previously secured funding led by Invesco, valuing the company at $10.7 billion in 2022. The food delivery giant competes with Zomato in India’s online restaurant and cafe food delivery sector, with both companies investing heavily in “quick-commerce” – rapid delivery of groceries and other products within 10 minutes.
Despite current market jitters, India’s IPO market has demonstrated resilience, with approximately 270 companies raising $12.57 billion so far this year, surpassing the $7.4 billion raised in all of 2023.
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