Rapido founders shed ‘promoter’ tags for IPO, joining a growing trend among new-age firms
An investor aware of the company’s plans said the reclassification was an exercise in preparation for Rapido’s public market launch in FY27.
“The company will soon begin the IPO process and will hire bankers,” the investor said on condition of anonymity.
Rapido follows other new-age companies whose founders have been reclassified as non-promoters to ease the burden of compliance after listing; It offers a variety of benefits, from advantageous board compositions to easier approval for salaries.
The board of directors of Roppen Transport Services Private Ltd, the company that operates Rapido, approved the reclassification of Sanka, Guntupalli and Rishikesh as non-promoter shareholders on August 20, 2025. This follows an application submitted by the co-founders on August 13, 2025.
“When the Company was still in its early stages, they (the co-founders) were classified as promoters of the Company. Since then, as the Company has grown and progressed, it is now professionally managed with the board of directors of the Company providing guidance from time to time,” the Board said in a letter to the Registrar of Companies on December 16. he said. “Currently, the Company’s operations and compliance are in autopilot mode, similar to other well-established corporate organizations.”
The board said it considered three factors before approving the application: Each of the co-founders held no more than 10% of the company’s total voting rights, they had no control over the company’s affairs, and they did not have any special rights attributable to them alone by formal or informal arrangements.
Sanka continues to serve as Rapido’s chief executive officer.
Rapido did not respond Mint‘s request for comment.
Companies without supporters
Other founders who have given up on promoter labels include Swiggy Ltd, Zomato’s parent company Eternal Ltd and FirstCry’s parent company. BrainBees Solutions Ltd, Delhivery Ltd, Policy Bazaar’s parent company PB Fintech Ltd and the soon-to-be listed Aye Finance Ltd.
The fact that founders are not supporters affects how the company’s board of directors is composed and how their compensation is determined. If a non-supportive, non-executive director serves as chairman of the board, only one-third of the board will need to be independent directors. Pune-based company secretary Gaurav Pingle said if a promoter or director acts as chairman, half of the directors should be independent.
“Furthermore, in the case of remuneration to a non-promoter executive director, there is no obligation to obtain shareholders’ approval by special resolution,” Pingle said. he explained.
As promoters, founders’ compensation will need to be approved by minority shareholders, introducing additional scrutiny and uncertainty. Promoters should also disclose details of shares mortgaged or pledged by them, Pingle said. This rule does not apply to those who do not support the campaign.
Yashojit Mitra, a partner at the Economic Law Practice, said promoters are often considered those who control a company’s business and affairs and face stricter compliance and disclosure requirements. Therefore, promoters who do not fall within the definition of ‘promoter’ by disposing of their shares generally apply to be classified as promoters under Regulation 31A of the Sebi (LODR) Regulations 2015, he said.
“Removing this classification gives them the flexibility to be like other investors with fewer legal restrictions and obligations attached,” he said.
capital infusion
Founded in November 2015, Rapido raised its last major capital round in 2024, raising $200 million at a $1.1 billion valuation in a Series E financing round led by WestBridge Capital. A startup with a billion-dollar valuation. New investors participated in the round, including Think Investments and Invus Opportunities, as well as existing investor Nexus Ventures.
With the fresh capital infusion, the Bengaluru-based company has outlined plans to expand its operations across India and grow its technology platform to enhance its service offering. It also highlighted its plan to expand its operations across all categories, including bike taxis, three-wheelers and taxis.
The company reported operating income ₹934 crore compared to FY25. ₹648 crore a year ago. Damage narrowed ₹258 crore ₹371 crore in FY24, according to the Entrackr report in January.
Last year, Swiggy has divested completely ₹2,400 crore shares in Rapido, selling shares to Dutch investment firm Prosus NV and WestBridge Capital.
Rapido’s rise has been rapid. It has expanded from two-wheeler ride-hailing service to cars, autos and finally food delivery under the brand name “Ownly”. Rapido is trying to crack open India’s tightly controlled foodtech market by charging restaurants nearly half the commission charged by incumbents Swiggy and Zomato.
The move leverages data and operational insights from Rapido’s previous partnership with Swiggy, where its fleet was often deployed for last-mile delivery.
