Why trade Deliveroos IPO with IG?

Speculate on Deliveroo

Take a position via Share CFDs on the Deliveroo share price

Go short as well as long

Buy or sell based on your prediction of Deliveroo’s market cap

Trade on margin

Gain full exposure with a small initial deposit, but remember with leverage comes increased risk

When did the Deliveroo IPO happen?

The Deliveroo IPO happened on 31 March 2021. You can trade in the shares on the secondary market.

How to trade the Deliveroo IPO after the listing

Once Deliveroo has listed, you can attempt to profit on the companys IPO with IG. As with all stock markets, you will now be able to go long or short on Deliveroo via CFD trading.

Trade in similar stocks today

If you want to get exposure to other companies in the food delivery industry right now, you can choose between stocks such as Uber, Delivery Hero and Just Eat.

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What is Deliveroo’s business model?

Deliveroo is a food delivery app and website developed to help individuals or companies order their favourite meals to their doorstep. Users can look up and order from restaurants on Deliveroo based on their location.

Payment can be made on the platform in under a minute. Once the order is placed, the restaurant is notified, and the user can track the progress of their order. Delivery is made by Deliveroo riders on bicycles, who stay stationed within 2.2 kilometres of the restaurants they sign up for. Deliveroo aims to deliver in under 30 minutes.

Our analysis on the Deliveroo IPO

By George Bear, Assistant Portfolio Manager

Deliveroo plans to raise £1 billion when it sells new shares as part of its IPO, currently planned for March 2021. It has been a major beneficiary of the lockdowns that have been part of the UK’s response to the Covid-19 pandemic, seeing a huge increase in revenues to £4.1 billion for 2020, compared to £2.5 billion in 2019. It continues to make a loss, although here the trend is in the right direction, with 2020’s loss of £223 million representing a notable improvement over 2019’s £317 million loss.

The firm looks to achieve a £7.6 billion valuation when it lists, taking advantage of the shift to takeaways as a result of the closure of restaurants across the UK. A market share of 20% is a 25% increase over 2019, suggesting that Deliveroo continues to gain ground against its rivals such as Just Eat Takeaway.com. It is not just a level of market share; Deliveroo has a higher average order size than its rivals Just Eat and Uber Eats, at £23 versus £21 and £17 respectively, helping to bolster its attractiveness versus competitors.

Having established itself in its home market, Deliveroo now needs to expand. The IPO will give it extra funding to achieve this, but it faces stiff competition from established competitors in key markets such as the US. In addition, the regulatory environment has become less congenial for these ‘gig economy’ companies, as governments and authorities take a closer look at the employment conditions of workers at firms like Uber and Deliveroo.

How has Deliveroo been performing?

Before the coronavirus pandemic hit, it was estimated that Deliveroo would contribute around £4 billion in economic output. However, order numbers started to decrease rapidly following national lockdowns and 15% of its workforce had to be laid off. Deliveroo’s funding in recent years has included a £459 million boost from Amazon in 2019. After Deliveroo’s latest fundraising round (January 2021), the company’s market cap was estimated at £7.5 billion.

Deliveroo has created more than 60,000 jobs and partnered with more than 80,000 restaurants. Headquartered in London, it services the UK, Ireland, France, the Netherlands, Belgium, Spain, Italy, UAE, Kuwait, Singapore, Hong Kong, Taiwan and Australia.

Who are Deliveroo’s competitors?

Deliveroo’s competitors are Uber Eats, Just Eat and City Pantry, to name a few. Deliveroo is the third largest food delivery app in the UK, after Just Eat Takeaway and Uber Eats. Just Eat held its IPO in April 2014 and was valued at £1.47 billion.

One thing that sets Deliveroo apart from its competitors is its delivery-kitchen concept, called Deliveroo Editions. Through comprehensive data gathering, it has identified gaps in the market and created pop-up restaurants in areas where people are not being serviced.

Deliveroo key personnel

There are five key executives on Deliveroo’s management team, as well as four members on the board of directors.

Deliveroo management team

Will Shu Co-founder and chief executive officer
Adam Miller Chief finance officer
Dan Winn Chief technology officer
Rohan Pradhan Chief operating officer
Patrick Wyatt VP product
Vince Darley VP growth

Deliveroo board of directors

Martin Mignot Board member
Benny Peretz Board member
Adam Valkin Board member
Darrel Cavens Board member
Luciana Lixandru Board member
Fred Destin Board member
Antoine Froger Board member
Claudia Arney Board member
Simon Wolfson Board member
Danny Rimer Board member

Who are Deliveroo’s main investors?

Deliveroo’s main investors are Amazon, T Rowe Price, Fidelity Management and Greenoaks Capital. Others include Index Ventures, DST Global and General Catalyst.

How do IPOs work?

IPOs are released when a company decides to start selling its shares to the public. The company will decide how many shares it wants to offer, and the investment bank will decide on the initial price of the stocks based on supply and demand.

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Who set up Deliveroo?

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Who set up Deliveroo?

Will Shu and Greg Orlowski set up Deliveroo in 2013 after Shu had spent a few years developing his idea for the service.

How does Deliveroo make money?

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How does Deliveroo make money?

Deliveroo makes money by charging both users and participating restaurants. Users are charged a delivery fee of £2.50, while restaurants pay a commission fee of up to 20% when users order from their menu via Deliveroo. The company also generates revenue by charging a fee for offering restaurant perks and promotions on its platform.

Why would Deliveroo want an IPO?

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Why would Deliveroo want an IPO?

Deliveroo might consider an IPO to raise more funds or to improve its reputation among the public. There is no confirmed date for the IPO and many reports state that the focus is on growing the business and reaching new customers, not an IPO specifically.

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