Swiggy’s Stellar Debut: A Milestone for India’s Startup Ecosystem
Introduction
Swiggy, a Bengaluru-headquartered food-delivery and quick-commerce startup, made its debut on the public markets with an impressive listing price of ₹455.95 ($5.4) on Wednesday. The company’s shares ended the day up 10.67%, marking a milestone for India’s startup ecosystem, where several firms are eyeing large public offerings in the next 24 months.
A Direct Comparable to Zomato
The closely watched listing makes Swiggy a direct comparable to what analysts have long considered the benchmark Indian internet stock: Zomato. With its valuation set at $11.3 billion, Swiggy’s IPO is the largest tech IPO globally this year, according to JPMorgan.
A Major Liquidity Event for Backers
The listing marks a major liquidity event for Swiggy’s backers, which include Prosus (with paper returns already reaching $2 billion), SoftBank, and Accel. A total of 5,000 employees stand to collectively reap about $1 billion from the IPO.
Co-Founder Sriharsha Majety’s Vision
In an interview, Swiggy’s co-founder and chief executive Sriharsha Majety said the firm wanted to make the offering exciting for new investors. "One of the things I am most excited about is that Swiggy itself is happening at an incredible time," said Majety in a speech. "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."
Entering the Public Markets
Swiggy enters the public markets at a pivotal moment for India’s e-commerce landscape. While the company 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.
Competitive Pressures and Viability Concerns
However, competitive pressures are intensifying. Traditional retail giants like Flipkart and Reliance’s JioMart are launching their own rapid delivery services. Questions also persist about the viability of the quick-commerce model outside major urban cities, given its reliance on dense networks of small warehouses.
The Opportunity Ahead
Despite these challenges, the opportunity ahead is substantial. Morgan Stanley estimates gross order values in India’s quick-commerce market could reach $42 billion by 2030, representing over 18% of the country’s total e-commerce market. The sector has already grown at a blistering 77% annually since it took off during the pandemic.
Conclusion
Swiggy’s stellar debut on Wednesday defied the weak market in India this week, with benchmark Sensex and Nifty extending their decline for the fourth consecutive day. As Swiggy continues to grow and expand its services, it will be interesting to see how the company navigates these competitive pressures and viability concerns.
IPOs Reported to Be in the Works for 2025
- Naboo: A concierge-style corporate event booking platform that has secured $21M in funding.
- Dub: A copy trading app that has gained popularity among teens.
- Heritable Agriculture: A startup using AI to improve crop yield, which was spun out of Google’s X.
