Shares of Swiggy dropped 4% to 401 rupees on Wednesday as the food delivery and quick commerce startup concluded India’s second-largest IPO this year, in a closely watched debut that puts it in direct comparison with what analysts have long considered the benchmark Indian internet stock: Zomato.
The listing of the 10-year-old Bengaluru-headquartered firm marks a milestone for India’s startup ecosystem, where several firms are eyeing similarly large public offerings in the next 24 months. It also delivers a major liquidity event for Swiggy’s backers, including Prosus, whose paper returns have already reached $2 billion, as well as SoftBank and Accel. Some 5,000 employees stand to collectively reap about $1 billion in wealth.
In the run-up to the IPO, Swiggy set its valuation at $11.3 billion, a notably conservative figure given rival Zomato’s recent $29 billion market capitalization. In an interview, Swiggy co-founder and chief executive Sriharsha Majety said the firm wanted to make the offering exciting for new investors. Shares of Zomato is also down 8% this month as foreign institutional investors continue to sell billions in Indian shares.
“One of the things I am most excited about is that Swiggy itself is happening at an incredible time,” he said in a speech Wednesday. “When we look at the next one to two decades, I think it’s India’s next two decades. There’s so much economic growth in front of us. The Indian pride is at an all-time high.”
Swiggy enters public markets at a pivotal moment in India’s digital commerce landscape. While it has established itself as India’s second-largest food delivery platform with 14 million monthly active users, it trails market leader Zomato across key metrics. Its annualized gross order value of $3.3 billion in food delivery lags about 25% behind Zomato’s, according to Macquarie research.
The gap widens further in quick commerce – the rapid delivery segment promising grocery de …