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During the Wednesday trading session, the shares of one of the leading E-commerce supply chain companies in India surges by upto 7 percent following plans to invest Rs.1,600 crores in their subsidiary Scootsy logistics Ltd through right issue for expansion of Instamart.
Price action
With the market capitalization of 1,12,213 Cr on Wednesday, the shares of Swiggy Ltd (NS:SWIG) jumped up to 3.8 percent making an Intraday high of Rs.534.80 compared to its previous closing price of Rs.501.85.
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What happened
Swiggy has announced to invest up to Rs 1,600 crore in its subsidiary, Scootsy, through a rights issue aimed at supporting the company’s growth and operations. The funding will be provided in phases with Rs 1,350 crore earmarked for the expansion of lease and license payments for dark stores and for strengthening the infrastructure required to support Swiggy’s quick commerce services and Rs 250 crore set aside for working capital.
Scootsy specializes in supply chain services such as warehouse management, order fulfillment, and shipping for wholesalers and retailers and will utilize the investment to enhance its operational capabilities this strategic move aligns with Swiggy’s broader goals outlined in its IPO prospectus, underlining the company’s focus on reinforcing its supply chain and expanding its presence in the competitive e-commerce and quick commerce markets.
About the Company
Swiggy Ltd is a leading Indian food delivery and logistics platform founded in 2014 in Bengaluru, the company operates in numerous cities across India and offers services such as food delivery, grocery shopping and other on-demand services.
Swiggy connects consumers with a wide range of restaurants and stores through its easy-to-use app that enables users to place orders and have them delivered to their doorsteps. It has expanded its business model which includes Swiggy Instamart a grocery delivery service and Swiggy Genie, a platform for courier services and it has revolutionized the convenience and speed of food delivery in India.
Recent Q225 results
Swiggy has announced it results post IPO, highlighting strong growth and improved profitability in both its food delivery and quick commerce segments.The Gross Order Value (B2C) grows 30 percent YoY to INR 11,306 Cr and Consolidated Adjusted EBITDA loss reduces 30 percent YoY to INR 341 Cr
Food delivery Adjusted EBITDA nearly doubles to INR 112 Cr as strong order growth enhances operating leverage. Instamart growth accelerates to 24 percent QoQ and Contribution margin improves 124 bps QoQ alongside the addition of 52 stores and 12 cities.
Financials
The company’s revenue rose by 30 percent, from Rs 2,851.53 crore in Q2FY24 to Rs 3630.8 crore in Q2FY25. Meanwhile, Net loss declined from Rs 657 crores to Rs 626 crore during the same period.
Written by Sridhar J
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