Legal · Commerce & Consumer Brands

DSM Fresh Foods faces scrutiny over fund diversion

By Startup Enthusiast · 12 September 2026

What they do

DSM Fresh Foods operates an online platform delivering fresh and frozen food products to customers

The company faces regulatory concerns regarding the diversion of IPO funds and potential violations of the Companies Act

Shareholders are set to vote on corporate restructuring and office relocation during the upcoming 11th annual general meeting

The company is holding its 11th Annual General Meeting on September 29, 2026.
Shareholders will vote on shifting the registered office from Delhi to Haryana.
The board approved a new Employee Stock Option Scheme for up to 1,200,000 options.
CARE Ratings flagged the misuse of IPO funds totaling ₹59.06 crores.
Funds were reportedly diverted to Google and Facebook marketing without shareholder approval.
Unsecured loans provided to directors may violate Section 185 of the Companies Act.

The company's stock price has fallen significantly to ₹74 from its IPO price of ₹100.
An extraordinary general meeting was called to approve loans and guarantees up to ₹100 crores.
The company is restructuring its capital to consist solely of equity shares.

The company delivers fresh and frozen food through its online platform.
It operates under the brand name Zappfresh.
The company previously utilized compulsorily convertible preference shares in its capital mix.
The new authorised capital is set at ₹25 crores divided into 2.5 crore equity shares.
The company maintains its registered office in Pitampura, New Delhi.