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Invesco in discussion to invest in Swiggy

Swiggy is nearing the completion of a fresh fundraising round of $500-600 million, headed by US asset management Invesco, according to three sources familiar with the matter. The process is expected to boost the online food delivery company’s worth to as much as $10 billion, more than doubling the estimate given to the seven-year-old business just a few months ago. Swiggy will go public later this year after edtech startup Byju’s and finance behemoth Paytm and will rank among India’s most valuable privately held firms if the acquisition closes.

Swiggy’s fresh funding comes soon after arch-rival Zomato’s successful IPO and is being viewed as a re-rating exercise for the Bengaluru firm, currently valued at $5.5 billion.

According to the sources cited above, Invesco is expected to invest $150-200 million. The rest of the capital comes from existing Swiggy investors such as Falcon Edge, SoftBank Vision Fund, and Prosus (previously Naspers).

Other balanced funds (which invest in both public and private markets), such as Fidelity, T Rowe Price, and Ballie Gifford, have been banking on huge Indian internet startups, especially in the last year, as a slew of local ventures have lined up to tap the capital markets.

“As a direct competitor to Zomato NSE 5.16 % and being neck-and-neck in terms of market share, Swiggy is looking undervalued,” said another source. 

Zomato’s stock closed at Rs 143.55 on Monday, up around 5% on the BSE, with a market capitalization of around $15.16 billion (Rs 1.12 lakh crore).

Until press time Monday, emails were sent to Swiggy CEO Sriharsha Majety, and an Invesco spokesperson had not responded.

“We are going to go aggressive not just on discounting but also on our own investments in non-food and food. That was the plan, and that will be the plan,” Majety said.

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BRL Editor
BRL Editor
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