US investment firm Invesco reduces fair value of Pine Labs, Swiggy

Pine Labs plans $1 bn IPO in India after getting Singapore court's approval to shift base

American investment firm Invesco has reduced the fair value of fintech firm Pine Labs and food delivery company Swiggy, according to its half-yearly shareholder report filed with the US Securities and Exchange Commission.

Invesco valued Pine Labs at $3.5 billion as of April compared to $3.8 billion as of January 31, and $4.8 billion as of December 31, 2023.

According to data platform Tracxn, Invesco has about 2.8 per cent stake in Pine Labs, Baron Capital holds 1.3 per cent and Peak XV Partners has 20.6 per cent stake in the firm. Actis has 7.8 per cent stake, Temasek has 7.7 per cent and Alpha Wave has 3.4 per cent stake in the company. PayPal has 6.0 per cent stake and Mastercard has 5.2 per cent stake in the firm.

Pine Labs, a merchant commerce platform, was valued at more than $5 billion in 2022 when it raised $150 million from Alpha Wave Global.

Pine Labs plans an initial public offering (IPO) of $1 billion in India, sources said earlier. Invesco’s action comes after Pine Labs received a Singapore court’s approval to relocate its base to India, merging its Singapore and Indian entities.

The company may seek a valuation of more than $6 billion in an IPO, according to industry sources. It may issue both new and secondary shares, and could also opt to do a pre-IPO fundraising round ahead of any listing.

Pine Labs had previously filed confidentially with the US Securities and Exchange Commission for an IPO in New York in 2022. The listing could have given Pine Labs a valuation of about $5.5 billion to $7 billion, according to sources.

The company deferred its plan for an overseas IPO due to volatile market conditions.

Invesco, which led Swiggy’s previous funding round, has marginally reduced the fair value of the food delivery giant as of April 30, compared to a quarter ago.

Swiggy raised $700 million in Invesco-led funding in January 2022, which made the Indian company a decacorn (a startup valued at over $1 billion) by doubling its valuation to $10.7 billion.

Early this year, Invesco marked up the valuation of IPO-bound Swiggy for the third consecutive time to $12.7 billion, a 19 per cent increase from what the company was valued at during its last fundraising, according to regulatory filings.

After facing a spate of valuation cuts early last year due to high cash burn and poor margins, Swiggy has been on a path of financial recovery as it gears up for a $1 billion initial public offering (IPO) likely later this year. As such, its investors have been consecutively marking up Swiggy's valuation over the last year.

A fund managed by US-based asset management firm Baron Capital Group this year also increased the valuation of food delivery firm Swiggy to $15.1 billion. This is 25 per cent higher than the last fair value recorded by the investor, according to regulatory filings with the US Securities and Exchange Commission (SEC). The Bengaluru-based firm has filed draft papers for an initial public offering (IPO). The latest valuation reflects the value of Swiggy as of March 31. As of December 31, 2023, Baron Capital valued Swiggy at $12.1 billion. Baron had participated in the $700-million funding round of the firm in January 2022.