Quick commerce startup Zepto is facing regulatory attention just as it prepares for its much-anticipated mega IPO. In its updated draft red herring prospectus (DRHP), the company disclosed that the Enforcement Directorate (ED) had summoned its founders over compliance-related queries under FEMA.

The development comes at a sensitive time, as Zepto is planning a major listing in the Indian stock market.

ED summons founders under FEMA scrutiny

Zepto founders:

• Adit Palicha
• Kaivalya Vohra

were summoned by the ED to submit documents related to:

• Foreign investments
• Audited financial statements (FY 2020–21)
• Shareholding structure
• Loan and guarantee details
• Income tax filings
• Bank account records

According to the filing, both founders complied and appeared before the ED multiple times in April and May 2026.

The company stated it has provided all requested documents and additional clarifications, and as of now, has not received any further communication suggesting escalation.

What Zepto said in its IPO filing

In its updated DRHP submitted to SEBI, Zepto clarified that:

• It has cooperated fully with ED inquiries
• It submitted all required financial and structural information
• No formal investigation or penalties have been initiated so far

The IPO is being closely monitored by regulators as part of its approval process.

IPO details and market expectations

Zepto’s planned public issue includes:

• Fresh issue of around ₹8,010 crore
• Offer for sale (OFS) of approximately 11.35 crore shares
• Total IPO size estimated at around $1 billion

The company had filed confidential papers with SEBI earlier and received approval in May 2026. Market reports suggest a possible listing window around July 2026.

Strong growth despite losses

Despite regulatory attention, Zepto continues to show rapid business expansion:

• Revenue grew about 75% year-on-year
• Quarterly revenue reached around ₹7,498 crore
• Net loss narrowed to ₹1,539 crore from ₹1,832 crore
• Over 210 million orders processed in a quarter
• More than 1,100 dark stores operating across India

This reflects strong scale growth in India’s competitive quick commerce sector.

Competitive landscape

Zepto is expected to join listed peers in India’s fast-growing instant delivery space, competing with:

• Swiggy (Instamart)
• Eternal (Blinkit)

Conclusion

While the ED summons adds regulatory attention ahead of its IPO, Zepto maintains that it has fully cooperated and remains on track for listing. The company’s strong revenue growth and expanding delivery network continue to make it one of the most closely watched startups in India’s quick commerce industry.