Bombay High Court Dismisses Pleas Against WeWork India IPO, Fines Petitioner Rs 1 Lakh

Last Updated:December 02, 2025, 10:21 IST The court imposed a Rs 1 lakh cost on the petitioner for “deliberate suppression” of material facts. The Bombay High Court dismissed two writ petitions seeking to halt or amend WeWork India Management Pvt. Ltd.’s initial public offering (IPO), ruling that allegations of misleading disclosures were “without merit" and affirming that the Securities and Exchange Board of India (SEBI) acted lawfully in approving the issue. A Division Bench of Justices R.I. Chagla and Farhan P. Dubash upheld SEBI’s scrutiny of the IPO documents, noting, “We are satisfied that SEBI has exercised due care and caution and complied with the legal requirements, including those prescribed under the ICDR Regulations, in connection with the WeWork India IPO." The court added that judicial intervention in SEBI’s actions should be limited, saying, “Courts should be slow from substituting its own wisdom in place of the actions of SEBI." The court also imposed a Rs 1 lakh cost on petitioner Vinay Bansal for “deliberate suppression" of material facts. Petitioners Alleged Incomplete And Misleading Disclosures The petitions, filed by Hemant Kulshrestha and Vinay Bansal, accused WeWork India of failing to disclose serious criminal proceedings against its promoters and risks tied to its brand licence in the Draft Red Herring Prospectus (DRHP) and Red Herring Prospectus (RHP). They argued that SEBI failed to act on their complaints. Senior Advocates Venkatesh Dhond and Amit Desai, representing the petitioners, contended that chargesheets filed by the CBI and the Enforcement Directorate (ED)- including offences under Sections 409 and 477A of the IPC and provisions of the Prevention of Corruption Act- were not adequately reflected in the disclosures. The counsel argued that WeWork India should never have been allowed to launch an IPO given its losses in FY22, FY23 and FY24 and a negative net worth of Rs 437.50 crore as of March 31, 2024. SEBI And WeWork India Defend IPO Process Appearing for SEBI, Senior Advocate Shiraz Rustomjee countered that it is the Lead Managers’ primary obligation to ensure accuracy of disclosures and that SEBI had thoroughly reviewed the documents. He cited SEBI’s 17-page letter dated July 8, 2025, which required several modifications that were incorporated into the final RHP. Senior Advocate Darius Khambata, representing WeWork India, argued that promoters were not exiting but merely reducing shareholding to comply with listing norms. He said the RHP fully disclosed all complaints and responses, which were available for public inspection. What Bombay High Court Said Rejecting the petitioners’ claims, the Bench noted that both the CBI and ED chargesheets were indeed disclosed in the offer documents. It further held that the IPO met Regulation 6(2) of ICDR Regulations, which allows issuers to proceed with book-built issues with 75% allocation to Qualified Institutional Buyers, even if profitability criteria are not met. “There is no infirmity on the part of SEBI in permitting WeWork India to make this IPO," the court said. The WeWork India IPO, which opened on October 1 and closed on October 7, had already raised Rs 1,348 crore from major institutional investors including ICICI Prudential Mutual Fund, HDFC Mutual Fund, Goldman Sachs and Allianz Global Investors. News business ipo Bombay High Court Dismisses Pleas Against WeWork India IPO, Fines Petitioner Rs 1 Lakh