Swiggy vote fails: AoA change for IOCC falls short

What happened and why it matters

Swiggy Ltd’s shareholders rejected a proposal that would have expanded founder and CEO Sriharsha Majety’s board nomination rights, marking the first time the company has seen a resolution voted down since it listed in November 2024. The proposal was part of a wider governance restructuring tied to Swiggy’s stated long-term plan to eventually qualify as an Indian Owned and Controlled Company (IOCC) under India’s foreign exchange rules.

Swiggy disclosed the voting outcome in a stock exchange filing, saying it failed to secure the required shareholder approval to amend its Articles of Association (AoA). While the special resolution on the AoA did not pass, shareholders strongly backed a separate proposal to appoint a nominee director. The split result underlined that investors were willing to approve a board appointment, but not the broader change to nomination rights in its proposed form.

The postal ballot and remote e-voting process

Swiggy ran the vote through a postal ballot using remote e-voting. The e-voting window opened on April 21, 2026 at 9:00 a.m. IST and closed on May 20, 2026 at 5:00 p.m. IST, with the process handled through NSDL’s e-voting facility.

The company had sought shareholder approval for two items: first, a special resolution to alter the AoA around board nomination rights and governance arrangements; and second, an ordinary resolution to appoint Renan De Castro Alves Pinto as a Non-Executive, Non-Independent Nominee Director.

How shareholders voted

In its Thursday filing, Swiggy said the special resolution for the Amendment of Articles of Association received 72.36% of votes, falling short of the required threshold by 2.65%. Swiggy’s spokesperson also cited 72.35% shareholder approval, again saying it missed the required threshold by 2.65%.

The second proposal, however, was approved with 98.98% votes in favour. The filing described the role as a Non-Executive, Non-Independent Nominee Director, and noted that the nomination was by Prosus.

This voting outcome was also described as the first time Swiggy’s shareholders have voted down a resolution since the company went public in November 2024.

What the proposed AoA amendment aimed to change

Swiggy’s AoA proposal focused on restructuring board nomination rights. The company said the amendments were intended to rationalise “legacy nomination rights” while maintaining management continuity and board-level representation for executives executing the company’s long-term strategy.

In the postal ballot notice, Swiggy outlined specific changes, including deleting nomination rights linked to certain investors and individuals and adding new nomination rights for senior management representation. The proposal stated that the amendments were limited to board nomination rights and did not grant special voting rights, veto powers, or perpetual board seats. It also said board composition, including committee structures, would continue to be determined in accordance with SEBI Listing Regulations and applicable laws.

The specific nomination rights Swiggy proposed to delete or add

Swiggy’s notice specified deletions of nomination rights for Accel Entities, SoftBank, and Lakshmi Nandan Reddy Obul, alongside additions for Majety and Phani Kishan Addepalli.

It also included a shareholding reference point for Accel Entities. Accel Entities held 2.77% equity as of December 31, 2025, according to the disclosure included in the postal ballot materials.

Why IOCC status is central to the governance change

Swiggy has repeatedly linked the AoA amendment to its broader effort to eventually qualify as an Indian Owned and Controlled Company (IOCC) under the Foreign Exchange Management Act (Fema) and related foreign investment rules administered by the Department for Promotion of Industry and Internal Trade (DPIIT).

The company clarified that the proposed amendment was part of a broader endeavour to become an IOCC “as and when the resident shareholding in the company increases beyond 50 per cent with necessary regulatory and shareholder approvals.” Swiggy also emphasised that the proposed amendments do not, by themselves, result in the company being classified as an IOCC, and that additional shareholder approvals and corporate actions would be required.

FEMA’s ownership and control tests, as described in the disclosures

Swiggy’s disclosures described IOCC as a classification that depends on both ownership and control. Under the rules referenced, beneficial ownership needs to be more than 50% with resident Indian citizens or Indian-controlled entities, and effective control over management and board decisions must also lie with resident Indians.

The disclosures also highlighted that “control” includes the right to appoint a majority of directors or the ability to influence management or policy decisions through shareholding, management rights, shareholder agreements, or voting agreements. Swiggy said it is attempting to address the “control” aspect before “ownership,” and that it currently lacks an identifiable promoter group with substantial board representation that can independently act as a safeguard for domestic control.

Company response after the vote

After the vote, Swiggy’s spokesperson said the company acknowledges the outcome and that the resolution “received 72.35 per cent shareholder approval, falling short of the required threshold by 2.65 per cent.” The spokesperson added that the amendment reflected Swiggy’s “long-term commitment to ensuring management representation on the Board” and advancing its transition toward becoming an IOCC under applicable foreign exchange laws and regulations.

Swiggy also said it would continue to engage with shareholders and work towards a positive outcome.

Key facts from Swiggy’s disclosures

Market and governance implications to watch

Swiggy’s filings position the AoA amendment as part of a multi-step governance and regulatory journey, rather than a single change that automatically alters its regulatory classification. The rejection means Swiggy did not get shareholder consent for its proposed restructuring of nomination rights in this round, even as it secured near-unanimous approval for the nominee director appointment.

The company has said that becoming an IOCC would require resident shareholding to rise beyond 50% and would need further regulatory and shareholder approvals. Its statements also suggest that it is focused on aligning board and control structures with the “control” test described in foreign exchange regulations, while acknowledging that the “ownership” test depends on future shareholding levels.

Conclusion

Swiggy’s shareholders backed the appointment of a nominee director but rejected the proposed AoA amendment tied to its longer-term IOCC roadmap. The company has said it will continue engaging shareholders, while noting that further approvals and corporate actions would still be required for any eventual IOCC classification.