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Swiggy’s IPO unlocks ₹9,000 crore in wealth for 5,000 employees

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.

Read the full report here

Swiggy needs to show investors the money: Bloomberg

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

Swiggy IPO listing live: Swiggy shares will be available for trade from 10 am today

Swiggy listing live: Swiggy shares to list on the NSE at ₹351

Swiggy IPO: Swiggy listing ceremony live

Swiggy IPO subscribed 3.59x led by QIBs, employees 

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. 

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