Shares of Indian food delivery giant Swiggy soared over 9% on their trading debut Wednesday after its teh company's stellar IPO — the country's second-largest this year.The company, which is backed by SoftBank, raised 113.27 billion Indian rupees in its IPO that closed Monday,Sign up for NBC San Diego's News Headlines newsletter.The IPO comprised both an offer for the sale of existing shares, worth 68.28 billion rupees, and a fresh issue of shares, worth 44.99 billion rupees.
Swiggy said the net proceeds of 43.59 billion rupees from the fresh issue of shares will be used to pay down borrowings in its subsidiary Scootsy, as well as for further investment in the subsidiary.In a note shortly before the stock started trading, Macquarie Equity Research said that the company had a"strong potential growth runway and improving margin," but a"long and winding road to profitability.
As this sector is only about 1% of India's overall grocery retail landscape, there is an"exponential latent growth runway" for Swiggy's delivery arm, Instamart, the research firm added.