Swiggy’s Indian control push; Cultfit’s big IPO swing

Swiggy has inched closer to qualifying as an Indian-owned and controlled company. This and more in today's ETtech Top 5.

Also in the letter:
■ CCI nod for Upgrad-Unacademy deal
■ Xbox layoffs and reset
■ Mission Drishti loses contact

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Sriharsha Majety, group CEO, Swiggy

Swiggy has crossed a key threshold on its way to becoming an Indian-owned and controlled company (IOCC), with foreign shareholding now below 50%.

What's changed:

• Foreign investors now hold 49.76% of its paid-up equity capital on a fully diluted basis as of July 6, according to a stock exchange filing.
• Swiggy said this shift does not change its ownership structure on its own and that it will disclose any material developments separately.

Why it matters:

• Under India's Foreign Exchange Management Act (FEMA), a company is an IOCC only if it is owned and controlled by resident Indian citizens or eligible Indian entities.
• IOCC status would allow Swiggy's quick commerce arm Instamart to own inventory directly and operate with fewer FDI restrictions.
• An inventory-led model could improve margins and tighten supply chain control by allowing Instamart to recognise the full value of goods sold as revenue.

The catch:

• Despite Indian shareholding crossing 50%, Swiggy is not yet an IOCC.
• To secure this, a majority of Swiggy's board must comprise Indian directors. A proposal to make this change was voted down by shareholders in May.
• The company will now need to seek approval from the Reserve Bank of India (RBI) to cap foreign shareholding at 49.5%.

Rival update: In April 2025, rival Eternal capped foreign ownership at 49.5% to secure IOCC status. That move allowed Blinkit to shift to an inventory-led model and book gross merchandise value as revenue, giving Eternal a revenue lift.

Also Read: ETtech Interview | Quick commerce industry unlikely to sustain as many players as today: Swiggy's Sriharsha Majety

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Mukesh Bansal, founder and Naresh Krishnaswamy, CEO, Cultfit

Fitness and active lifestyle platform Cultfit has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) for an initial public offering (IPO).

IPO contours:

• Issue size: Rs 3,500–4,000 crore
• Fresh issue: Rs 950 crore
• Offer for sale: Up to 178.6 million shares
• Pre-IPO placement: Up to Rs 190 crore; if this goes through, the fresh issue size will shrink accordingly.

Selling shareholders:

• Chiratae (IDG Ventures India Fund III and Chiratae Trust): Up to 28.1 million shares
• Temasek: Up to 24.7 million shares
• Fitness First: Up to 19.6 million shares
• Mukesh Bansal: Up to 16 million shares
• Tata Digital: Up to 15.9 million shares
• Others include Bruno Eduard Raschle, Schroders Capital, Accel, Epiq Capital, Kalaari, Valecha Investments and actor Hrithik Roshan.

Where the money goes:

• Rs 276.6 crore to open new Cult Elite and Cult Neo centres
• Rs 217.5 crore towards lease, rent and licence payments
• Rs 120 crore to repay borrowings
• Rs 75 crore for brand marketing
• Rs 23.4 crore to expand Cultsport's exclusive brand outlets
• The balance will go towards general corporate purposes

Also Read: Cultfit raises $47 million from Singapore's Temasek

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UpGrad's Ronnie Screwvala and Unacademy's Gaurav Munjal

The Competition Commission of India (CCI) has cleared the merger of Unacademy and UpGrad, paving the way for one of the biggest consolidation moves in India's edtech sector.

More on this:

• The deal, first reported by ET, will see UpGrad acquire Unacademy in an all-stock transaction valuing the Bengaluru-based company at Rs 2,055 crore ($218 million).
• The deal prices Unacademy at more than 90% below its 2021 peak valuation of $3.4 billion.

Why UpGrad wants this:

• Unacademy is expected to have Rs 900-950 crore in cash at closing, as we reported.
• That war chest makes it a compelling buy as UpGrad doubles down on online test preparation and adjacent learning categories.
• Unacademy cofounder Gaurav Munjal has said he will continue to lead the company after the merger.

What else? The CCI nod comes around two months after the companies sought antitrust clearance.

A confidential valuation report reviewed by ET in May valued UpGrad Education at $1.7 billion (Rs 15,980 crore) as of February 28. The report estimated that Unacademy could contribute around Rs 500 crore to the combined company's consolidated revenue.

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Asha Sharma, CEO, Xbox

Xbox CEO Asha Sharma is framing one of the division's largest-ever rounds of job cuts as a “reset” rather than a retreat.

Driving the news:

• Xbox plans to eliminate around 3.200 roles in FY27.
• About 1,600 of those jobs are going immediately.

Big studio moves:

• Compulsion Games, Double Fine Productions, Ninja Theory and Undead Labs will leave Xbox and come under new ownership.
• Compulsion and Double Fine will become independent studios while retaining their IP and game catalogues.
• Ninja Theory and Undead Labs will shift to new owners, who will fund their ongoing projects.
• Job cuts will also touch Activision, Bethesda/ZeniMax, Blizzard, King, Mojang and Xbox Game Studios, though no announced titles are being cancelled at this stage.

Also Read: Coursera to cut jobs in post-Udemy merger restructuring

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More than two months after launch, spacetech startup GalaxEye has lost contact with Mission Drishti, billed as the world's first OptoSAR satellite.

What went wrong:

• GalaxEye said the satellite experienced an anomaly following a geomagnetic storm during the final stage of the Launch and Early Orbit Phase (LEOP).
• Recovery efforts are still underway, but the startup has warned that the chances of restoring contact currently appear low.
• Initial analysis suggests radiation from the solar storm likely damaged a critical onboard system.

About Drishti: Mission Drishti is the first satellite to combine Synthetic Aperture Radar (SAR) and multispectral imaging (optical sensors) on a single platform. The OptoSAR configuration was designed to deliver all-weather, day-and-night earth observation.

By cutting through cloud cover and poor lighting, Drishti aimed to sharpen satellite intelligence for sectors including defence, disaster management, agriculture and infrastructure planning.