Foodtech giant Swiggy, operated by Bundl Technologies Pvt Ltd, has raised $700 million in Invesco-led new funding, which, according to sources, has made the outfit a decacorn, almost doubling its valuation to $10.7 billion.
Swiggy’s latest valuation is almost double that of Zomato before the latter went for its initial public offering. Zomato was valued at $5.4 billion before its IPO.
The round saw participation from a host of investors such as Baron Capital Group, Sumeru Venture, IIFL AMC Late-Stage Tech Fund, Kotak, Axis Growth Avenues AIF- I, Sixteenth Street Ghisallo, Smile Group, and Segantii Capital.
Its existing investors Alpha Wave Global (formerly Falcon Edge Capital), Qatar Investment Authority, and ARK Impact, along with its long-term investor Prosus also participated, the company said.
Swiggy to accelerate growth on the core platform
The investment comes when the adoption of food and online grocery is accelerating and consumer demand for Swiggy’s many services continues to grow.
The food-delivery business has nearly doubled in gross order value (GOV) in the last year. This fundraiser will enable Swiggy to accelerate growth on the core platform and make meaningful investments to grow Instamart.
The quick commerce grocery service remains well-positioned to continue to lead the emerging space and is set to reach an annualized gross merchandise value (GMV) run rate of $1 billion in the next three quarters.
“The GMV, our food delivery business, achieved in 40 months, took Instamart just 17 months, demonstrating the platform benefits of Swiggy. We will double down on this to build more categories in line with our mission of offering unparalleled convenience to Indian consumers,” said Sriharsha Majety, Chief Executive Officer, Swiggy.
“Our goal is to make Swiggy the platform that 100 million consumers can use 15 times a month. We will continue to invest in our people, products, and partners,” he added.
Valuation comes at a time of bloodbath in the market
Swiggy’s fundraising and valuation boost come when rival Zomato, which got listed last year, has seen its market capitalization erode rapidly. Zomato had an issue price of INR 76 a piece and had seen a blockbuster stock market debut in July 2021.
In November, the stock had even hit an all-time intraday high of INR 169. However, the stock has fallen nearly 50 percent since then.
Other new-age technology companies, which got listed last year, have also seen their share prices fall sharply off late.
Shares of FSN E-Commerce, which owns and operates online beauty and cosmetics retailer Nykaa, have fallen over 30 percent from its all-time high.
Paytm, meanwhile, operated by One97 Communications, has been the worst hit, as the stock has fallen over 55 percent from its issue price of INR 2,150 apiece. On Monday, the stock ended at INR 917.45 a share.
Meanwhile, Majety said, “Our goal is to make Swiggy the platform that 100 million consumers can use 15 times a month. We will continue to invest in our people, products, and partners to create a positive impact on the ecosystem and accelerate the digital transformation in food and grocery delivery and other on-demand services.”
Many shareholders have raised concerns over the profitability of these companies. However, Majety was confident about Swiggy’s food delivery business turning profitable soon and continues to do so.