By Soni 
Swiggy IPO: Swiggy’s IPO (Initial Public Offering) is the talk of the town in the Indian market. The IPO is set to open on November 6, and investor enthusiasm is evident. In this article, we will focus on Swiggy’s business model, its market share, financial position, and comparison with Zomato. Let’s see if Swiggy’s IPO can be a better option than Zomato.
Swiggy’s business model
Swiggy is a super app that offers many other services apart from food delivery. Its key features include:
- Food Delivery: Users can order food from various restaurants through the app.
- Dine Out: Users can book seats in restaurants.
- Quick Commerce: Facility to deliver goods in 10 to 20 minutes.
- Event Booking: Facility to buy tickets for events.
Due to this diversity, Swiggy’s platform offers many services in a single app, thereby meeting the customer’s requirements.
Market Share and Competition
In the competition between Swiggy and Zomato, Swiggy performed well in terms of market share in 2021. However, Zomato is still getting more orders. Apart from this, Swiggy’s user acquisition cost is also decreasing, making it a profitable option.
Swiggy: Financial Position and Revenue
Swiggy’s revenue was Rs 6,120 crore in 2022, which is estimated to increase to Rs 11,634 crore in 2024. This shows a compound annual growth rate (CAGR) of 37%. However, the company has also shown a loss of Rs 4,000 crore in the last financial year. It will be important to improve this situation to achieve profitability in the future.
Swiggy: Profitability Challenges
Swiggy still faces challenges in profitability. In 2023, the company reported a loss of Rs 4,000 crore, and it is currently in a loss position of Rs 600 crore. Investors have to understand that Swiggy still has to work hard towards becoming profitable.
Swiggy IPO valuation and grey market premium
Swiggy’s IPO will come in the price band of ₹3371 to ₹3900, and its grey market premium (GMP) is not satisfactory yet. For the listing of the IPO, investors have to see how many times the subscription is received in the first two days. With high subscription, the chances of getting a good return during listing increase.
Swiggy comparison with Zomato
Zomato has made its mark in the food delivery sector. While Swiggy has also expanded its food delivery and other services, Zomato has more orders. However, Swiggy’s quick commerce and super app concept gives it a distinct competitive advantage.
User Experience and UI/UX
Swiggy’s user interface (UI) and user experience (UX) improvements have enhanced its usability. Food delivery options are available directly on the app’s home page, making it easier for users to order. Fewer clicks required and a straightforward experience make it more appealing to use.
Swiggy: Future Prospects
Experts believe that if Swiggy takes the right steps towards its profitability, its valuation could even be higher than Zomato. With the growing demand for quick commerce and the right strategy, Swiggy could see significant growth in the coming years.
Conclusion
Swiggy’s IPO could be a significant opportunity, but investors need to take a careful decision. Given the challenges to profitability, it is essential to take a balanced approach.
Investment Advice
Evaluate your financial position and risk tolerance before investing in this IPO. It is always a good idea to seek professional advice before investing.