Baron Capital marks up stake in Swiggy, values it at $15.1Bn ahead of IPO

US-based asset manager Baron Capital has significantly marked up the valuation of its stake in Swiggy, assigning it a valuation of $15.1 billion. This update, as reflected in regulatory filings, indicates an increase of 25% from the previous valuation of $12.2 billion, established just three months earlier.

According to reports, Baron Capital increased the fair value of its stake in Swiggy to $109 million. It comes at a time when Swiggy’s financial performance in recent years has been a mix of rapid revenue growth and losses, though the latter has consistently decreased over time. For the first three quarters of the financial year FY24, Swiggy recorded a revenue of ₹5,476 crore but also posted a loss of ₹1,600 crore. The previous financial year (FY23) saw the company generate ₹8,265 crore in revenue, alongside a more pronounced loss of ₹4,179 crore. Earlier this year, US-based investment firm Invesco raised Swiggy’s valuation to about $8.3 billion.

Speaking of Swiggy, its journey began in the food delivery domain, but its vision has broadened since then. Over the years, the company expanded its offerings to encompass quick commerce (Swiggy Instamart) and courier services (Swiggy Genie) in order to grab a slice of the hyperlocal delivery market pie and eventually cater to a wider range of customer needs. As of December 31, Baron Capital had valued the foodtech major at $12.1 billion.

This development also comes as Swiggy is gearing up for its IPO. The food delivery and aggregator upstart has plans to raise ₹3,750 crore (approximately $450 million) through a fresh issue of shares and ₹6,664 crore (around $800 million) via an offer-for-sale (OFS) component. Additionally, Swiggy aims to secure ₹750 crore from anchor investors before the public listing. In April 2024, the company secured shareholder approval for a $1.25 billion public issue and filed confidentially with the Securities and Exchange Board of India (SEBI). The IPO is expected to comprise a fresh issue of shares worth $449 million and an offer-for-sale component of around $799 million.

Baron Capital’s latest mark-up also comes amidst a broader trend of valuation adjustments within the startup ecosystem. Other prominent Indian startups such as Pine Labs, Meesho, FirstCry, and Ola Electric have also experienced valuation mark-ups in recent months. In contrast to this, Baron Capital slashed the valuation of its stake in edtech major Byju’s by 99.85% as of March 31.