Athira Sethu
Kochi, 13 November 2024
Swiggy’s successful listing on Indian bourses on Wednesday is likely to create huge fortune for its employees. The food delivery giant is on track to create significant wealth for its team, with estimates suggesting that around 500 employees could become crorepatis, or millionaires, thanks to a massive payout through employee stock options (ESOPs).
The total amount of money being unlocked for these employees is about Rs 9,000 crore, marking a major milestone in India’s startup ecosystem.
The food delivery to quick commerce firm saw its shares being listed on Wednesday with a 7.69% premium over its IPO price of Rs 390 on NSE at Rs 420. It debuted with a premium of 5.64% at Rs 412 on BSE.
Such sound listing has thus created a golden opportunity for Swiggy employees to cash in on all the growth up till now. The company has issued three major ESOP plans up to 2024. These have built up almost 230 million shares, and about 9 million of these options have already been converted into actual shares. Just a month before the IPO, employees having these options, will be able to sell their shares. SEBI has granted an exemption for employees holding such options. Hence, at a time when other companies still would have a lock-in period on their shares, the employees of Swiggy would see their wealth accelerate faster.
The Swiggy IPO also reminds one of the historical success of Flipkart’s Employees Stock Option Plan. It is interesting to note that Flipkart happens to be an Indian e-commerce platform which has bought back its employees’ ESOPs to the tune of $1.5 billion so far. When Flipkart split off one of its subsidiaries, PhonePe, last year, it paid out $700 million to employees. So, in this hope for the Swiggy IPO too, it’s not very different – a new benchmark in creating wealth for Indian Startups.
This is a victory for the lower-level employees of the firm as well as its top management. ESOPs held by Swiggy founders Sriharsha Majety, Nandan Reddy, Phani Kishan, and other top leaders are worth more than Rs 2,600 crore after the IPO.
