Swiggy’s successful IPO has made nearly 500 of its employees crorepatis due to the significant value of their Employee Stock Option Plans (ESOPs). These ESOPs, which grant employees the right to purchase company shares at a discounted price, have skyrocketed in value following the IPO. This windfall is a reward for the hard work and dedication of these employees who have contributed to Swiggy’s growth and success.
Hundreds of Swiggy employees are set to become millionaires after the food delivery aggregator made a successful debut in the stock market on November 13, with shares listed at Rs 420 on the National Stock Exchange (NSE), reflecting a 7.7% premium over its IPO price of Rs 390.
On the Bombay Stock Exchange (BSE), Swiggy’s shares opened at Rs 412, marking an increase of 5.64% from the IPO price. The listing would also give a significant value to the employee stock option plans (ESOPs).
This IPO is considered one of the largest wealth creation events in India’s startup ecosystem that will make around 500 employees Crorepatis.
How Did Swiggy Do It?
According to Swiggy’s Draft Red Herring Prospectus (DRHP), the total number of outstanding Employee Stock Options (ESOPs) as of September 2024 amounted to 231 million, valued at Rs 9,046.65 crore based on the IPO’s upper price band of Rs 390 per share.
This development is expected to elevate nearly 500 Swiggy employees, who would join the Crorepati club, with their ESOP holdings now worth several crores. In total, around 5,000 employees are set to benefit from the ESOP payouts, according to reports from The Economic Times.
Around 5,000 persons associated with Swiggy, including current and former employees, are expected to gain significantly from the Bengaluru-based quick commerce player’s listing in the stock market.
The stock listed at an 8 per cent premium on the BSE and NSE at Rs 420 apiece, compared to its issue price of Rs 390 apiece. Its valuation at the upper end of the IPO price was Rs 87,087 crore.
Other Companies Offered ESOPs in Past
Prior to Swiggy, ecommerce giant Flipkart also paid Rs 5,800 crore to its 17,000 current and former employees in July 2023, the report added. Additionally, fintech major Paytm also spent Rs 3,336 crore on ESOP payments to top brass since October 2021 — even as the company’s stock price remains over 50% below its IPO price in November 2021.
Besides ecommerce and quick commerce companies, the fashion and beauty startup ‘Nykaa’ issued 7.65 lakh equity shares under its employee stock option (ESOP) scheme in September 2024.
Delhivery also allotted 6.15 lakh equity shares on September 10, while Tracxn allotted 1.8 lakh equity shares under its ESOP schemes earlier this year.