Swiggy: From a forgotten idea to Rs 1 trillion market cap on listing

Framing the next chapter in Swiggy’s journey as a responsible corporate citizen, Co-founder and Chief Executive Officer (CEO) Sriharsha Majety unveiled the company’s eagerly awaited public listing.

 

Majety, who has largely shunned the spotlight, shared reflections on his entrepreneurial path and the strategic pivots he and his co-founders navigated in building Swiggy.

 

“We started with code aggregation, then pivoted to logistics, and that became Swiggy. It was during our second year when I convinced an old friend to join us and head expansion. His first reaction was, ‘This is the same thing we did in the college project at IIM Calcutta’. That germ of an idea had completely slipped my mind,” he said during the listing process at the National Stock Exchange.

 

He further added that the journey from a forgotten idea to execution is in itself a “rarity”. “But to execute it to the size and scale we have now is nothing short of a miracle,” he said. 

 

Swiggy is the first company to list through the Securities and Exchange Board of India’s confidential listing route, highlighting the competitive nature of the sector. This listing places Swiggy in direct competition with its larger rival, Zomato.

 

Deepinder Goyal, co-founder and CEO of Zomato, welcomed Swiggy’s listing. “Congratulations @Swiggy! Couldn’t have asked for a better company to serve India with,” Goyal posted on X, tagging another Zomato post that read, “You and I… in this beautiful world @Swiggy.”

 

Majety has already expressed his expectations for the company’s continued strong growth. In a pre-initial public offering (IPO) interaction, Majety shared his vision of 100 million consumers using the platform 15 times a month in the future, as he sees the food delivery business becoming more profitable in the coming decade.

 

He said that the next phase for Swiggy will focus on scaling up its services to cater to a consumer base of 300-500 million, expected to grow over the next one or two decades.

 

The listings of Zomato and Swiggy demonstrate how new-age tech-enabled firms are competing with traditional players in the consumer-focused segment.

 

For example, since its listing in 2021, Zomato’s market capitalisation has gone ahead of companies like Nestlé India, Varun Beverages, Britannia Industries, Godrej Consumer Products, and United Spirits, according to data from Bloomberg and exchanges.

 

Similarly, Swiggy is now ranked higher than Tata Consumer Products, Dabur India, Colgate-Palmolive India, and Patanjali Foods.

 

Handsome returns for investors

 

Swiggy’s listing has provided a strong exit for several early investors. Prosus, one of the company’s largest investors, has reaped around $2 billion. The company’s senior leadership confirmed that they invested $1.3 billion in Swiggy to build their stake to 31 per cent. Even after the partial exit, Prosus will retain a 25 per cent stake in Swiggy.

 

Ashutosh Sharma, head of growth investments — India and Asia at Prosus, said, “Wednesday’s listing is a landmark achievement for Swiggy and a milestone for Prosus in India. Prosus has invested more than $8 billion in some of India’s best-known digital companies, including Swiggy, Urban Company, and Meesho, along with many promising early-stage startups. Swiggy’s IPO is the latest success story for Digital India.”

 

Some of Swiggy’s initial investors have seen returns of 3x to 35x since the company’s listing.

 

“This IPO is a testament to the grit, innovation, and consumer focus that Swiggy has consistently brought to the market,” said Anand Daniel, partner at Accel.

 

Mukul Arora, co-managing partner at Elevation Capital, one of Swiggy’s earliest backers, said, “With Swiggy going public, I feel tremendous pride and gratitude toward Harsha and the entire Swiggy team. I’ve had the privilege of watching Harsha become a visionary leader, someone who embodies the best of entrepreneurship,” Arora wrote in a blog post.

 

Elevation Capital made a seed investment in Swiggy back in 2014 after meeting over 50 startups in the food delivery space.

 

“But within the first few minutes of our conversation, it was clear that this was going to be different,” Arora added.

 

Swiggy now works with more than 220,000 restaurant partners and stores in over 680 cities in India. Its quick commerce (qcom) network has expanded to 605 dark stores across 43 cities. The company reported a 26 per cent year-on-year increase in gross order value, reaching $4.2 billion in 2023-24.

 

Niren Shah, managing director and head of Norwest India, which has invested over $19 million in Swiggy, lauded the company for pioneering qcom through Instamart, developing a full-stack delivery model, and creating innovations like Genie, Swiggy One, and a unified application.

 

“What an amazing journey it has been — from a $35 million valuation when we invested, to now a $12 billion valuation. Sriharsha Majety and his team have always been truly visionary!” he said.

 

With inputs from Peerzada Abrar