Prosus has made a significant gain of more than $2 billion from its investment in Swiggy, the popular food delivery platform, as the company moves towards its IPO
Prosus has made a significant gain of more than $2 billion from its investment in Swiggy, the popular food delivery platform, as the company moves towards its IPO in India. The move underscores the growing value of Prosus’s investment portfolio, which has been expanding beyond its holdings in Chinese tech giant Tencent.
Swiggy, India’s leading food delivery service, is set to go public with an IPO targeting a valuation of up to $11.3 billion. The company, which has revolutionized food delivery in India, is now ready to tap into the country’s booming stock market.
For Prosus, the investment is already paying off. Prosus, along with its parent company Naspers, invested a total of $1.3 billion to acquire a 31% stake in Swiggy. As the company moves towards its IPO, Prosus’s investment has ballooned in value, contributing to an impressive $2 billion gain. This huge upside comes as Swiggy looks to raise funds from the public market, with many analysts bullish on its prospects due to the growth potential of India’s online food delivery market.
As part of the IPO, Prosus plans to sell some of its shares, but it will retain a 25% stake in Swiggy once the company lists on the Indian stock exchanges. This means that while Prosus is set to profit from the IPO, it will continue to benefit from Swiggy’s growth moving forward, especially given the rapid expansion of the food delivery market in India.
Ervin Tu, the Chief Investment Officer at Prosus, emphasized that this is just the beginning. “We expect to benefit from the upside of the business and the tailwinds of the fast-growing Indian market,” Tu said in a recent interview. Prosus is betting on Swiggy’s continued success, with future growth in the Indian market driving further returns.
Prosus has invested in several Indian companies, and it sees great potential in the market. With a rapidly growing digital economy and increasing smartphone adoption in India, the country has become a key focus for global investors. Swiggy’s IPO is just one example of how companies in India are attracting global attention and capital.
Apart from Swiggy, Prosus has other investments in India’s tech sector, and many of these companies are expected to go public in the coming years. This could give Prosus even more opportunities to capitalize on India’s fast-growing market.
While Prosus’s investment in Swiggy is a recent highlight, the company is perhaps best known for its blockbuster investment in Tencent, the Chinese tech giant. In 2001, Prosus’s parent company Naspers made an audacious move by investing $34 million for a 50% stake in Tencent. That investment paid off massively. Today, Prosus holds about a quarter of Tencent, which is valued at nearly $480 billion.
This success has not only been a financial boon for Prosus, but it has also shaped the company’s strategy in other markets, including India. However, Prosus’s stake in Tencent has at times overshadowed its other investments, distorting its stock price and creating a gap between the value of its other businesses and its stake in the Chinese tech giant. The Swiggy investment is a step towards balancing that portfolio and positioning Prosus as a key player in the fast-growing Indian market.
As Swiggy prepares for its public debut, all eyes are on the potential for future growth. Prosus is clearly optimistic about the company’s future, and with the $2 billion gain, it’s already a big winner in this deal. As Swiggy grows, so too will Prosus’s returns, and its continued stake in the company positions it well for the years to come.
In the coming months and years, Swiggy’s performance on the stock market will be closely watched by investors, and Prosus will be ready to capitalize on the company’s expansion across India and beyond. With Prosus’s backing, Swiggy is in a strong position to keep expanding its lead in the competitive food delivery market.
