Online food and grocery delivery company Swiggy is planning to cut 400 jobs in a new round of layoffs as it aims to reduce costs and achieve profitability before going public, reported The Economic Times.
This will affect about 6 per cent of its workforce across various teams, such as technology, call center, and corporate roles, according to sources quoted in the report.
“Senior executives have been given a list and need to identify executives to be laid off. The process has begun,” said a source quoted in the report.
The layoffs have been linked to Swiggy’s much-anticipated initial public offering (IPO) later this year, where it aims to present strong financial numbers. “This is linked to the planned IPO of Swiggy where it needs to present the best possible numbers,” added the source.
The Bengaluru-based company, which currently employs 5,500 to 6,000 people, had earlier undergone restructuring in January 2023, letting go of 380 employees due to slowing growth in its food delivery business.
Swiggy’s core food delivery business is stable, but it has been facing losses in its grocery unit, Instamart.
The company has about $800-900 million in the bank, according to a person quoted in the report.
Swiggy, which competes with listed peer Zomato in the online food and grocery delivery space, has seen its core food business grow, with a gross merchandise value (GMV) of $1.43 billion, while Instamart’s GMV grew by 63 per cent.
However, the pressure to achieve profitability has increased as Swiggy plans to go public this year, with an expected IPO size of $1 billion.
If the company files its draft IPO papers, it will join other firms like FirstCry, Ola Electric, Mobikwik, and Unicommerce, all planning to go public this year.
Source: India Today
