Swiggy has indicated it will reattempt to secure shareholder approval to amend its Articles of Association (AoA) to become an Indian-Owned and Controlled Company (IOCC), following a recent vote that fell short of the required threshold, according to inc42.com. The company views this transition as a key long-term objective aligned with its strategic goals.
About a week ago, Swiggy sought shareholder approval to amend its AoA to qualify as an IOCC but received only 72.36% votes in favor, below the 75% needed for special resolutions, inc42.com reported. The company is now working constructively with shareholders to address concerns and aims to achieve a positive outcome. Swiggy clarified that the proposal was not intended to strengthen founder control but to comply with India’s foreign direct investment (FDI) regulations, which restrict foreign-owned ecommerce marketplaces from directly owning inventory unless they qualify as Indian-owned and controlled.
The move to become an IOCC is significant because it would allow Swiggy to shift its quick commerce business, Instamart, towards an inventory-led model. This aligns with the direction taken by comparable companies in India and is expected to create long-term shareholder value. The amendment is part of Swiggy’s broader strategy to comply with regulatory requirements and enhance operational flexibility in the competitive foodtech and quick commerce sectors.
Swiggy plans to continue engaging with shareholders and stakeholders through lawful and transparent processes to evaluate future structural or strategic steps, inc42.com stated. The company’s next milestone will be securing the necessary shareholder approval to implement the amendment, which will enable it to pursue its inventory-led business model and strengthen its position in the Indian market.