Swiggy Slumps Nearly 8% After Renewed Push To Cap Foreign Ownership

Shares of Swiggy tanked as much as 7.8% to ₹242.60 during the intraday trading on the BSE, a day after the company’s board approved a proposal to cap its aggregate foreign ownership at 49.5% as part of its renewed push to become an Indian-owned and controlled company (IOCC). 

The stock pared some losses later and was trading 5.29% lower at ₹247.75 at 11:55 IST, valuing the company at ₹68,303 Cr (about $7.1 Bn). The decline in the stock came amid investor concerns that the proposed foreign ownership cap could trigger selling by some foreign shareholders. 

Following the board’s approval, Swiggy will now seek shareholder approval for the proposal. The move is aimed at helping the company qualify as an IOCC under the Foreign Exchange Management Act (FEMA). 

Earlier this month, Swiggy disclosed that its aggregate foreign ownership had declined to 49.76%, bringing it closer to the proposed cap. 

An IOCC status offers companies greater regulatory flexibility while making investments, setting up subsidiaries and operating in sectors where foreign investment restrictions apply. 

The move is primarily aimed at moving its quick commerce arm Instamart to an inventory-led model from a marketplace model amid intense competition in the segment. Instamart’s rival Blinkit has already made this transition.

The latest move marks Swiggy’s second attempt this year to cap foreign ownership in the company. In May, shareholders rejected a special resolution to amend the company’s Articles of Association (AoA) after it secured 72.36% votes in favour, below the 75% threshold required for approval. 

At the time, InGovern founder Shriram Subramaniam said that Swiggy “failed to communicate clearly to its shareholders” the rationale behind seeking IOCC status. 

This time, Swiggy has proposed a fresh set of AoA amendments, including removing certain board nomination rights held by existing individual and institutional shareholders. It also plans to introduce a revised framework for board nomination rights for specified resident Indian shareholders, while defining the conditions under which such rights can be exercised or lapse. 

With the proposed changes, Swiggy is aiming for greater control of Instamart’s inventory as it looks to cut down the losses of the vertical amid discounting wars and aggressive expansion by rivals.

On the financial front, Swiggy continues to report losses. In Q4 FY26, Swiggy reported 26% YoY and 24.9% QoQ decline in its loss. Revenue from operations rose 44.7% YoY to ₹6,383 Cr. 

The company is yet to release its financials for the quarter ended June.

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