US-based Invesco marks up Swiggy's valuation by 43% to $7.85 billion

This comes after two markdowns by US investor in four months

US-based fund manager Invesco has marked up the valuation of Indian food aggregator Swiggy to $7.85 billion (about Rs 65,000 crore), after slashing it twice in four months in 2023, according to a regulatory filing.  

This is an almost 43 per cent mark-up from the $5.5 billion valuation that Invesco had given to the platform as of July 31. However, the latest valuation is still 30 per cent lower than Swiggy’s peak valuation.

In January 2022, the Bengaluru-based startup had raised a massive $700 million funding round led by Invesco, which made Swiggy a decacorn, valued at $10.7 billion. In March this year, however, Invesco cut the company’s valuation to $8 billion, before slashing it further to $5.5 billion in July.

This is the second time an investor has marked up the valuation of Swiggy. In August, US-headquartered asset management firm Baron Capital had marked up the food aggregator’s valuation by 33.9 per cent to $8.54 billion.

The Softbank- and Prosus-backed firm, which is gearing up for an initial public offering (IPO), is making efforts lately to improve its financial health.

Since the beginning of 2023, Swiggy has undergone retrenchments by way of layoffs and shutting down many of its business verticals. The firm also introduced a Rs 2 platform fee for all its users, which has now gone up to Rs 3.

This led to its food delivery business turning profitable in the March quarter of FY23 (Q4FY23) after considering corporate costs and excluding employee stock options (ESOPs). The company’s monthly cash burn also came down to $20 million from $45-50 million that it was losing each month during its peak in 2021. 

Several other Indian start-ups, too, have had their valuations marked up by foreign investors in recent months. This has come on the back of a renewed focus on profitability, after a prolonged period of cash burn and ‘growth at all costs’ for many start-ups.

US-based investor Fidelity had increased the face value of its investment in e-commerce firm Meesho in its books by 14.3 per cent to $43.24 million as of July, bringing the company’s valuation to around $5.04 billion.

Days before that, Baron Capital had raised the valuation of Pine Labs, a fintech platform, to $4.92 billion as of June 30, up 10 per cent from a quarter ago.