Swiggy describes the move as part of a strategic effort to unlock investments and generate value for shareholders
Swiggy has approved the sale of its holding in bike-taxi operator Rapido through two separate transactions totalling Rs 2,399 crore. As per the exchange filing, the food delivery company will divest shares worth Rs 1,968 crore to Netherlands-based MIH Investments, while another Rs 431 crore worth of shares will be transferred to Setu AIF Trust.
Swiggy described the move as part of a strategic effort to unlock investments and generate value for shareholders, while reiterating its focus on its core food delivery and grocery businesses. Rapido, backed by Swiggy in its early stages, has grown rapidly across Indian cities in the bike-taxi and shared mobility segment. The divestment represents one of Swiggy’s largest portfolio exits in recent years.
Separately, the board also cleared the transfer of quick-commerce operations under the Instamart brand to Swiggy Instamart, a wholly owned subsidiary. The company said that the slump sale is likely to be completed by the end of the third quarter of the current financial year. In an exchange filing, the company noted that the sale includes all relevant assets, permits and licenses, liabilities, records, intellectual property, employees and contracts.
Ahead of the declaration, Swiggy’s shares closed flat at Rs 449.95 on the NSE. However, on Monday, the stock slipped as much as 3 per cent after brokerage JM Financial downgraded its rating to “reduce” from “hold”, cutting the price target to Rs 420 from Rs 460.
The brokerage cited concerns over the company’s weak balance sheet and called for corrective measures. The downgrade coincided with media reports that Swiggy was considering selling its Rapido stake to bolster its finances.
