Swiggy's board has approved a proposal to cap the company's aggregate foreign ownership at 49.5 per cent on a fully diluted basis, as it seeks to qualify as an Indian-owned-and-controlled company (IOCC) under India's foreign exchange regulations.
The proposal will be placed before shareholders for approval through a special resolution at the company's 13th Annual General Meeting (AGM) scheduled for August 18, according to a regulatory filing.
Securing IOCC status would allow Swiggy to directly own and sell inventory through its quick commerce business, Instamart. The inventory-led model is expected to improve margins, enhance supply chain control and strengthen operational efficiency. Rival Blinkit, owned by Eternal, already operates under this model.
Swiggy has been pursuing IOCC status for several months. In May, the company failed to obtain shareholder approval for amendments to its Articles of Association (AoA), which were required to meet the ownership and control criteria.
Alongside the foreign ownership cap, the board has also approved proposed amendments to the AoA to align with the Foreign Exchange Management Act (FEMA) regulations. The changes include the removal of certain nomination rights held by existing individual and institutional investors, introduction of nomination rights for specified resident individuals, and related revisions to governance provisions.
The board has also approved the reclassification of its authorised preference share capital into authorised equity share capital, subject to shareholder approval.
If approved, the changes will move Swiggy closer to qualifying as an Indian-owned-and-controlled company, giving it greater flexibility to operate its quick commerce business under an inventory-led structure. |
