Former Swiggy employee embezzled Rs 33 crore from the company: Report

According to a report by Moneycontrol, the Bengaluru-based food delivery company, Swiggy, in its annual report for the financial year 2023-24, has disclosed that a former junior employee had embezzled Rs 33 crore over the past periods.

Details of the embezzlement

In a report on 4th September, the company mentioned that "The Group, during the current year, identified embezzlement of funds in one of the subsidiaries by a former junior employee amounting to Rs 326.76 million over the past periods…” 

"Based on review of the facts discovered during the investigation, the Group has recorded an expense for the aforementioned amount during the year ended March 31, 2024."

After reviewing a copy of the report, Moneycontrol has detailed that Swiggy has formed an “external team” to look into the matter. They have also filed a legal complaint against the said former employee. However, Swiggy did not respond to Moneycontrol's detailed queries about the incident. 

Swiggy’s new strategies

It has been reported earlier that the food aggregator company is looking to raise Rs 3,750 crore (around $450 million) through a fresh issue and up to Rs 6,664 crore (around $800 million) as an offer-for-sale (OFS) component in its $1.25 billion IPO by this year. 

As stated in the company’s annual report in FY24, Swiggy’s revenue grew 36 percent to Rs 11,247 crore. It narrowed losses to 44 percent from Rs 4,179 crore to Rs 2,350 crore by cutting down expenses.

Swiggy went on spending Rs 13,947 crore in FY24, which was 8 percent lower than the previous year. Also, the brand’s promotion and marketing spending has gone from Rs 2,501 crore in FY23 to Rs 1,851 crore in FY24.

In its annual report, Swiggy has admitted that the crest of its investment is in quick commerce and that it will have to improvise strategies. "The continued scale-up in the recent years is driven by an upwards momentum witnessed in demand and supply side factors with (around) 14 million users transacting on our platform at a high frequency of (about) 4.5X. Profitability has sharply improved YoY, as the peak of investments in Instamart is behind us, and the business continues to grow rapidly; while the relatively more mature Food delivery business is scaling-up profitably.” 

Closing thoughts

In FY24, Zomato was the market leader in the food delivery business, with a 57% share. Swiggy is lagging behind its rival with a 43% market share.