Online food ordering and delivery platform Swiggy’s losses rose by 80 percent in the 2022-23 financial year (FY), according to an annual report released on June 27 by Dutch investor Prosus. The company's losses surged by 80 percent, rising from approximately $300 million in FY22 to a staggering $545 million in FY23.

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Prosus, which has a stake of 33 percent in the food delivery company, said that its share of Swiggy's trading loss increased to $180 million in FY23 in comparison to $100 million in FY22, as of its investments in Instamart.

Swiggy, however, mentioned that the peak of its investments in Instamart was now largely behind the company.

Moreover, Prosus said its share of revenue in the company rose 40 percent to $297 million in FY23. This would put Swiggy's revenue for the whole FY23 at around $900 million.

"In the last two reporting periods, Swiggy has concentrated on reactivating users, increasing monthly frequency and improving user conversion. The benefits are reflected in its results for FY23," Prosus stated in its FY23 annual report.

"Our share of Swiggy’s trading loss increased to $180 million (from $ 100 million in FY22), driven by investment in Instamart, which peaked in the year," it added.

Swiggy's CEO and co-founder Sriharsha Majety had earlier said that the company's losses increased in a year when the food delivery business had witnessed a slowdown globally.

While its competitor Zomato's revenues in FY23 were roughly similar to Swiggy's gross sales, the notable distinction lies in their respective financial losses. Zomato incurred significantly lower losses of approximately $126 million whereas Swiggy's losses amounted to around $545 million.

The rise in Swiggy's losses also comes at a time when Majety told that the company's core business, food delivery, had been profitable in March 2023, excluding employee stock ownership plan (ESOP) costs and was on a path to turning profitable.

Gross merchandise value (GMV) of Swiggy grew to $2.6 billion in FY23, up from $2.3 billion in FY22, registering a modest increase of just around 13 percent, Prosus added.

Swiggy's growth in GMV was primarily due to an expanded restaurant base. The company stated that it now has over 2.72 lahks enabled restaurants on its platform, which was 1.97 lakh in FY22.

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Even with a minimal growth rate, Swiggy's GMV remained significantly below its closest competitor, Zomato.

In its filings, Gurugram-based Zomato had said its GMV was around $3.2 billion in FY23, up from around $2.7 billion in FY22.

Prosus slashes Byju's fair value to $5.1 billion

Prosus has slashed Byju's fair value to $5.1 billion, and as such, the fair value of its 9.6 percent stake in the edtech company was pegged at $493 million.

Byju's had in October 2022 been valued at over $22 billion when it raised $250 million in a funding round. However, a month later, Prosus had first slashed the valuation to $5.97 billion.

The fresh cut in valuation comes at a time when Byju's has been hit by a resignations of its top board members, Russel Deisenstock, GV Ravishankar and Vivian Wu, and its auditor Deloitte, Haskins and Sell.

First Published:Jun 27, 2023 11:24 PM IST