Swiggy makes a major announcement, plans to raise ₹10,000 crore amid a sharp decline in its shares; plans made in collaboration with 3 banks

News Topical, Digital Desk : Online food and grocery delivery company Swiggy is now preparing to expand its business further. The company has taken steps to raise funding of up to Rs 10,000 crore. For this, Swiggy has selected JP Morgan, Kotak Mahindra Capital and Citi Bank as its financial advisors. According to the information, Swiggy will raise this fund through Qualified International Placement (QIP). However, the date of the QIP launch is not yet decided. The company's board approved the fund raising on November 7, which is subject to shareholders' and regulatory approval.

Focus on Growth Capital and Innovation

Swiggy CFO Rahul Bothra said, "Our food delivery unit continues to grow profitably. This new funding will primarily be used for growth capital and innovation projects." He added that the company's balance sheet is already strong and the sale of its stake in Rapido will also boost its cash reserves.

Swiggy sells 12% stake in Rapido

Swiggy recently announced the sale of its 12% stake in Rapido to Prosus and Westbridge Capital for ₹2,399 crore. The deal will provide the company with additional capital, which it will invest in quick commerce and new innovations.

Swiggy in loss, Zepto in profit

Swiggy's move comes at a time when rivals like Blinkit and Zepto are aggressively expanding in the quick delivery market. Swiggy's quick commerce business has shown over 100% growth for the third consecutive quarter. Although Swiggy's net loss increased by 74% to Rs 1,092 crore in the September quarter, revenue reached Rs 5,561 crore, significantly higher than Rs 3,601 crore last year.

On the other hand, rival Zomato reported a profit of ₹65 crore in the same quarter, though its profits declined 63% year-on-year. Experts believe Swiggy's fundraising is aimed at long-term expansion and technology innovation. The company wants to position itself as a leader in the quick delivery market over the next year.

Swiggy Share Price fell below the listing price

Swiggy shares closed in the red on Monday, November 10. The shares fell 3.60% and closed at Rs 386.95 on the NSE. With this, its shares once again started trading above the listing price. Swiggy shares were listed on November 13, 2024, at a price of Rs 390. Its 52-week low is Rs 297 and high is Rs 617.30. The shares have lost more than 15% so far. Swiggy's market cap is Rs 96,444 crore.

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