Swiggy Stock Plummets 6% On Day Two of Trading After IPO

Mumbai, India - March 2023: Shares of newly-listed food delivery and quick commerce major Swiggy declined nearly 6 percent on the second day of trading, Thursday, following its successful initial public offering (IPO) that received a significant response from investors.

The stock tumbled 5.72 percent to Rs 429.85 apiece on the Bombay Stock Exchange (BSE), with shares also losing 8.18 percent to Rs 418.65 during the day. On the National Stock Exchange (NSE), Swiggy’s shares ended at Rs 430.70, down 5.54 percent.

The decline in stock prices led to a significant erosion of the company's market valuation, which fell by Rs 5,842.35 crore to Rs 96,219.66 crore.

On Wednesday, the stock was trading with a premium of nearly 17 percent against the issue price of Rs 390. Swiggy’s market cap had surpassed Rs 1 lakh crore on the day of its listing on the stock exchanges.

The Rs 11,327-crore initial public offer (IPO) got fully subscribed, with investors participating in the offer-for-sale (OFS) portion of the IPO at a rate of 3.59 times subscription.

The company had received bids for all shares in the IPO, which was oversubscribed by 6.35 times. The share sale involved a fresh issue of shares worth Rs 4,499 crore and an OFS of Rs 6,828 crore.

Going forward, Swiggy plans to use the proceeds from the fresh issue to invest in technology and cloud infrastructure, brand marketing and business promotion, debt payment, and inorganic growth, as well as funds for general corporate purposes.