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Swiggy has taken a significant step towards securing Indian-owned-and-controlled company (IOCC) status, with its board approving a proposal to cap total foreign ownership at 49.5 per cent on a fully diluted basis.
The proposal, disclosed in a regulatory filing, will be placed before shareholders for approval through a special resolution at the company's 13th Annual General Meeting (AGM) scheduled for August 18.
Obtaining IOCC status would allow Swiggy to adopt an inventory-led model for its quick commerce business, Instamart, enabling it to directly own and sell inventory. The move is expected to improve supply chain control, enhance operational efficiency and support stronger profitability. Rival Blinkit, owned by Eternal, already operates under this model.
Swiggy has been pursuing IOCC status for several months. However, in May, shareholders did not approve the amendments to the company's Articles of Association (AoA) that were required to comply with ownership and control norms.
Alongside the proposed foreign ownership cap, the board has approved fresh amendments to the AoA to align the company with the provisions of the Foreign Exchange Management Act (FEMA). These changes include introducing nomination rights for certain resident individuals, withdrawing specific nomination rights currently held by select individual and institutional investors, and making related governance changes.
The board has also approved the reclassification of its authorised preference share capital into authorised equity share capital, subject to shareholder approval.
If shareholders approve the proposals, Swiggy will move closer to qualifying as an Indian-owned-and-controlled company, providing greater operational flexibility for Instamart under an inventory-led business model.
