AICPDF Calls for SEBI Intervention on Loss-Making Quick-Commerce IPOs

The All India Consumer Products Distributors Federation (AICPDF) has appealed to SEBI to temporarily halt IPOs of loss-making quick-commerce companies. AICPDF argues these companies pose a risk to small investors and India's retail ecosystem, and SEBI should intervene until competition investigations are resolved.

The All India Consumer Products Distributors Federation (AICPDF) has made a significant appeal to the Securities and Exchange Board of India (SEBI), urging a temporary halt on Initial Public Offerings (IPOs) by loss-making quick-commerce companies. This move by AICPDF aims to safeguard small retail investors and protect the integrity of India's retail trade environment.

According to AICPDF, many quick-commerce firms continue operating despite ongoing substantial losses and negative cash flows. These businesses often exist due to continuous injections of private capital, primarily used to sustain consumer discounts and build logistics infrastructures. AICPDF argues that such companies should not be allowed IPOs until clear profitability models are in place.

Recent examples cited include Zomato and Swiggy, which went public following extended periods of losses, allowing early investors to exit profitably even as companies reported continued financial struggles. The AICPDF has also filed complaints with the Competition Commission of India regarding alleged predatory pricing and anti-competitive behaviors by these platforms.

(With inputs from agencies.)