Baron Capital’s filing for the December 2022 reporting period was submitted in March.
The investor had participated in Swiggy’s January 2022 funding round, when the Bengaluru-based startup raised $700 million at a valuation of $10.7 billion.
Notably, according to regulatory filings, Baron Capital had marked down Swiggy’s valuation to $6.7 billion as of June 2022, just six months after buying a stake in the company, and has since raised it to $7.1 billion.
Institutional investors review valuations of private market holdings in their books at regular intervals in line with comparable valuations of publicly listed companies.
On May 9, ET reported that funds managed by Invesco had slashed the food-delivery platform’s valuation by 33% to $5.5 billion (from $8.2 billion), having already lowered it from $10.7 billion earlier.
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In addition to Swiggy’s valuation cut, several other late-stage startups have seen their private valuations being revised by US institutional investors. They include edtech platform Byju’s, fintech company Pine Labs, e-pharmacy PharmEasy, and mobility company Ola. These companies saw their valuations being marked down by asset managers and investors such as BlackRock, Vanguard, Invesco, Neuberger Berman and Janus Henderson. While Baron Capital’s markdown was done for the December 2022 reporting period, Swiggy has been facing new challenges in 2023. The SoftBank and Prosus-backed company has laid off 380 employees so far this year amid a slowdown in its core food-delivery business.
Swiggy has also been recalibrating its other businesses to cut down on costs in a weak investment ecosystem. The company recently shut down its gourmet grocery service Handpicked, which ET first reported on May 3.
Baron Capital’s markdown of Swiggy’s valuation was first reported by Moneycontrol.
Swiggy’s rival Zomato, which listed during the tech boom of 2021, has also seen its stock fall by nearly 50% since it went public in July 2021. On Tuesday, Zomato’s shares opened at Rs 64 apiece on the National Stock Exchange.
Baron Capital’s March regulatory filing showed that the asset management firm was invested in Zomato as well, as of December 2022.