Swiggy has become an Indian-owned and controlled company (IOCC) after shareholders approved capping foreign ownership at 49.5%, enabling a major shift in Instamart’s business model. The approval came at Swiggy’s 13th annual general meeting, where over 99.9% of shareholders voted in favour of the proposals. This change allows Instamart to adopt an inventory-led model, directly procuring products from brands, according to inc42.com.
The move to an inventory-led model will give Instamart greater control over product assortment, pricing, inventory availability, and fulfilment. Swiggy aims to improve gross margins by negotiating directly with brands and focusing on high-demand products. However, this pivot also introduces new operational challenges such as managing procurement, working capital, stock risk, and potential wastage. The company’s shareholders backed these changes to qualify as an IOCC under FEMA, providing Swiggy more flexibility in structuring its businesses, inc42.com reported.
This strategic shift comes as Swiggy seeks to address Instamart’s high cash burn and losses, which reached ₹651 crore in Q1 FY27. By controlling inventory, Swiggy hopes to rein in losses and improve profitability. The move aligns with broader trends in quick commerce, where companies are balancing rapid delivery with cost efficiencies. Swiggy’s transition to an inventory model positions it to compete more effectively in India’s fast-growing quick commerce sector, inc42.com noted.
Swiggy’s shareholder approval to cap foreign ownership and amend its Articles of Association was finalized at the 13th annual general meeting, marking a key regulatory milestone. This approval enables the company to implement the inventory-led model for Instamart, potentially impacting its financial performance in the upcoming quarters, inc42.com confirmed.