Swiggy shares fall over 7% as Flipkart eyes food delivery; foreign ownership cap may trigger massive outflows

Swiggy shares were in the spotlight today as the stock of the food delivery and quick commerce company declined 7.2% intraday, hitting a day low of ₹242.51 apiece on NSE. As of 10:45 am, Swiggy stock recovered some ground but still trades 6.2% lower at ₹245.2 per share.

The stock fall came after the company’s board approved a proposal to cap the company's aggregate foreign ownership at 49.5% on a fully diluted basis, down from the current 100% level. The move comes in order to maintain its status as an Indian-owned and controlled company (IOCC).

As per experts, IOCC (Indian owned and controlled company) status would allow Swiggy to directly own and sell inventory through its quick commerce brand Instamart, a move expected to improve margins and strengthen supply chain control.

Earlier in September 2025, Blinkit, owned by Eternal successfully transitioned to IOCC by reducing the foreign ownership to comply with FDI rules.

This move allowed the company to directly purchase goods from brands and sellers instead of acting as a traditional marketplace. Under Indian FDI rules, e-commerce marketplaces with over 50% foreign ownership cannot hold or sell their own inventory directly.

Swiggy’s proposal to cap foreign ownership will now be placed before shareholders for approval through a special resolution at the company's 13th Annual General Meeting (AGM) on August 18, a regulatory filing said.

Why did Swiggy shares fall over 7% today?

As per experts, Swiggy's decision to cap foreign ownership at 49.5% would lead to passive outflows as the company’s stock weightage would be adjusted in global indices like the MSCI Standard Index and the FTSE index in line with the foreign ownership structure. As per estimates, this outflow could be in the range of $270 to $330 million.

Flipkart enters food delivery business

Sudden fall in Swiggy shares is mainly due to this factor as investors are panic-selling. Besides this, e-commerce firm Flipkart's decision to enter the food delivery business also impacted investors' sentiments. Walmart-owned e-commerce giant Flipkart plans to launch pilot operations in Bengaluru for its online food delivery within 30 days. As per the company’s CEO, Flipkart is exploring a separate app for food delivery while also making the service available through the Open Network for Digital Commerce (ONDC).

Rival food delivery firm Eternal, which operates Zomato, also declined 3.4% intraday as the entry of Flipkart would only increase the competition intensity within the online food delivery space, which is currently dominated by Zomato and Swiggy.

Earlier this year, Rapido's zero-commission food delivery app, Ownly was launched across Bengaluru in March 2026.