SoftBank-backed Swiggy's shares soar over 13% on India market debut after stellar IPO

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The company’s IPO, the country’s second-largest this year, was reportedly oversubscribed more than three times.

Shares of Indian food delivery giant Swiggy soared more than 9% on their trading debut Wednesday after a 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 DFW's News Headlines newsletter.The IPO comprised an offer for the sale of existing shares worth 68.28 billion rupees, as well as a fresh issue of shares worth 44.99 billion rupees.

They pointed out that the"quick commerce" industry in India has seen rapid adoption in the past 1-2 years. However, Macquarie raised concerns over the profitability of Instamart, saying that there were headwinds to improving the unit economics of the business. Macquarie is still optimistic on Swiggy catching up with market leader Zomato on the food delivery segment. It added that while Swiggy is not as profitable as Zomato due to a smaller base and higher branding and employee costs, it could potentially bridge that gap.

 

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