Ajay Nain, Co-Founder of Rentomojo, Files to Halt IPO at NCLT Citing Allegations of Misleading Share Sale Practices

Rentomojo IPO Plans Hit by Former Director's NCLT Petition

Rentomojo, a rental startup backed by Accel and ValueQuest, is facing a legal hurdle in its proposed initial public offering (IPO). The company's draft red herring prospectus reveals that Ajay Nain, a co-founder and former director, has moved the National Company Law Tribunal (NCLT) seeking to halt the IPO.

Nain's petition, filed on March 25, 2026, alleges that he was misled into selling his stake in Rentomojo on August 22, 2023, when he sold 2,222 equity shares representing 9.41% of the company's stake. The petition seeks to declare the transaction void and restore his shareholding, alongside other reliefs including the removal of the company's promoter from the board and curbs on directors' powers.

Key highlights of the petition include:

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• Interim directions restraining Rentomojo from proceeding with its IPO, including filing or pursuing offer documents with Sebi and taking any steps towards the listing.
• Removal of the company's promoter from the board and curbs on directors' powers.

The matter has not yet been listed for hearing, and Rentomojo has filed caveats to ensure no orders are passed without its representation. The company's IPO plans, which include a fresh issue of Rs 150 crore and an offer for sale of around 2.83 crore shares by existing investors, are now uncertain.

Rentomojo's financial performance has improved ahead of the listing, with net profit rising 92% to Rs 43.1 crore in FY25 on revenue of Rs 266 crore, and Rs 61.3 crore in profit in the first half of FY26. Proceeds from the fresh issue are slated to be used primarily for debt repayment and lease-related expenses.