Swiggy Gets Shareholder Nod To Move Towards Indian-Owned, Controlled Status

Swiggy shareholders have approved a proposal to move the food delivery and quick-commerce company towards becoming an Indian-owned and controlled company (IOCC).

The approval comes after shareholders rejected the proposal in May. Under the latest plan, Swiggy will work towards keeping foreign ownership at or below 49.5%, bringing the company closer to meeting the requirements for IOCC classification.

The company said foreign investment in Swiggy stood at around 49.76% of its total paid-up equity share capital on a fully diluted basis as of 6 July.

Foreign Ownership Cap Set At 49.5%

Swiggy said the current foreign ownership level does not, by itself, change its existing ownership or control status.

Company Secretary and Compliance Officer Cauveri Sriram said the shareholding position does not affect the company's share capital, management, business operations or voting rights. It also does not change the rights attached to the company's equity shares.

The management further said that the company will disclose any material developments in line with applicable laws.

Under the Foreign Exchange Management Act (FEMA) framework, a company can qualify as an IOCC when more than 50% of its ownership is held by resident Indian shareholders and effective control lies with resident Indian citizens or eligible Indian entities.

IOCC Status Could Give Swiggy More Flexibility

The proposed change is important for Swiggy because an IOCC classification could provide greater flexibility under India's foreign investment rules.

The company believes moving towards Indian ownership and control could make it easier to structure and expand its operations. Swiggy competes with Eternal, formerly known as Zomato, across both food delivery and quick commerce.

Swiggy First Proposed Move In May

Swiggy had first announced its plan to move towards IOCC status in May. At the time, it said changes to its board nomination framework would form part of a wider effort to meet the requirements for Indian ownership and control.

The company said the proposed governance changes came after questions from institutional investors about how the amendments would fit into its longer-term ownership and control structure.

Swiggy does not have an identifiable promoter group holding a substantial stake or exercising dominant control over its board. Unlike some other Indian companies, it does not have an existing promoter structure that can act as a safeguard for domestic control.

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