According to an internal document, Indian food delivery giant Swiggy incurred a loss of $200 million for the nine months leading up to December 2023. The company is currently eyeing a stock market listing and is backed by SoftBank.
Sources familiar with the matter previously informed Reuters that the SoftBank-backed company might pursue a listing by the end of the current year. Despite India’s booming stock market, both domestic and foreign investors have become more cautious about IPOs by Indian startups due to concerns about unrealistically high valuations of companies that are still operating at a loss.
For the full fiscal year 2022-23, Swiggy reported a loss of 41.8 billion rupees ($500 million) as per the document. However, the company’s cost-saving measures such as lower wage payouts and reduced marketing spending are expected to help mitigate losses for the full year 2023-24, according to a source with direct knowledge of the situation who preferred to remain anonymous.
The document revealed that losses amounted to 17.3 billion rupees ($207 million) during the first nine months of the fiscal year 2023-24, with revenue reaching $1.02 billion during the same period compared to $1.05 billion in the fiscal year 2022-23.
Despite queries seeking comment, Swiggy did not respond.
India’s stock market has experienced a 28% surge over the past year, prompting many companies to consider listings, but they are met with cautious investors. Paytm, a digital payments firm that is still incurring losses, witnessed an 80% drop in its shares since its listing in 2021, which was criticized at the time for overvaluing itself.
Similarly, Swiggy’s competitor Zomato also faced a decline in its shares after its 2021 listing but has seen a 45% surge this year after posting two consecutive quarterly profits.
In 2022, Swiggy was valued at $10.7 billion by investors. Initially focused on meal deliveries, the company has since diversified into delivering groceries and offering restaurant bookings.
