Swiggy board clears ₹10,000-cr fundraising plan amid growing competition

The move comes a week after Swiggy said it was exploring new fundraising options in response to rising competition and a rapidly changing external market environment

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Bengaluru-based food delivery platform Swiggy on Friday said its board has approved raising up to ₹10,000 crore through public or private offerings, including qualified institutions placement (QIP) or other permissible modes.

 

The fundraising will be carried out in one or more tranches, subject to shareholder and regulatory approvals, the company said in a filing to the Bombay Stock Exchange (BSE). The funds will be raised by issuing equity shares or other instruments as permitted under applicable laws.

 

The development follows the company’s announcement last week that it was considering additional fundraising in view of the competitive and dynamic external environment.

 

How does this relate to market competition?

Swiggy’s decision comes amid heightened competition in both the food delivery and quick commerce segments. Rival Zepto last month raised $450 million (about ₹4,000 crore) at a valuation of $7 billion, strengthening its market position in the q-commerce space.

 

Swiggy said it remains confident about its financial position, with a cash balance of ₹2,400 crore following the divestment of its stake in bike-taxi platform Rapido.

 

What has Swiggy told its shareholders? 

“However, the external competitive environment is dynamic, and legacy and new players continue to attract investments to the sector. This has necessitated a conversation with the board to consider additional fundraising, which will give us access to sufficient growth capital while enhancing our strategic flexibility,” Swiggy said in a letter to shareholders.