US-based fund manager Invesco slashed the valuation of food delivery aggregator Swiggy. In a regulatory filing by Invesco in the US, the fund manager noted that it slashed Swiggy’s valuation to $5.5 billion. According to the filings with the Security and Exchange Commission (SEC), Invesco has valued Swiggy’s shares at $3,305 as of January 31, 2023.

This development marks the second instance of Swiggy’s valuation taking a hit and being marked down in recent quarters. Back in October 2022, Invesco reduced Swiggy’s valuation from $10.7 billion to $8.2 billion. At that time, Blackrock also slashed the valuation of edtech giant Byju’s by nearly half to $11.5 billion. Overall, the reduction in the valuation of Swiggy marks a decrease of 48.6% from the valuation of $10.7 billion, as well as 31.2% lower from the $8.2 billion it was valued prior to the reduction. It also comes amidst Swiggy’s plans to go public.

Swiggy was one of the few decacorns in India – Byju’s, PhonePe, Flipkart, and Nykaa being the others – and the recent slashing of its valuation pulls it below the market capitalization of Zomato, its biggest rival in the Indian food delivery sector. Zomato boasted a market capitalization exceeding $13 billion at a time, but since then, the economic downturn and plunging stocks and valuations decreased that amount to around $6.78 billion. And in September 2022, SoftBank reportedly marked down Oyo’s valuation from $10 billion to $2.7 billion, marking a steep decline.

Swiggy, one of the leading food and grocery delivery platforms in India, had been one of the few beneficiaries of the pandemic. With people staying at home and restaurants shut, the demand for food delivery skyrocketed at an unprecedented rate. Swiggy evolved its model during the pandemic lockdowns to keep pace with the ongoing shift in consumer mindsets, even as the initial phase of the pandemic months saw a dip in the number of restaurants that were operational. Last year, entered the decacorn club with strong funding of $700 million, marking a time when the food delivery market was riding on a high.

Interestingly, it was Invesco that led the round in January of the previous year. Some of the other names who took part in the funding round include Baron Capital Group, Sumeru Venture, IIFL AMC’s late stake tech fund, Kotak, and Qatar Investment Authority, amongst others. This development comes even as investors are tightening their purse strings and re-evaluating the worth of their investments amid adverse macroeconomic conditions.

This, in turn, has resulted in numerous investors across the globe re-evaluating the valuations of technology companies, as well as a funding crunch. In fact, the funding into Indian startups has dropped by over 20 percent YoY, something that has prompted even high-profile firms like Unacademy, Byju’s, and Swiggy to lay off employees, focus on profitability, clamp down on costs, and even pull the plug on some business verticals.