Ullu Digital’s plan to go public may be facing unexpected headwinds after the Ministry of Information and Broadcasting (MIB) directed internet service providers to block access to the OTT platform earlier this month. The move, citing objectionable and unlawful content on the app, has triggered uncertainty around what was set to be the largest IPO in India’s SME segment, reported media organisations.
Why the ban?
The government’s action was carried out under provisions of the Information Technology Act, 2000, and the Digital Media Ethics Code Rules, 2021. Section 79(3)(b) of the IT Act and Rule 3(1)(d) of the Ethics Code were specifically cited in the notice that listed 25 streaming platforms, including Ullu, ALTT, MoodX, Big Shots, Desiflix, Hulchul, and Mojflix, for takedown.
Ullu had filed its draft red herring prospectus with the BSE SME platform in February 2025, aiming to raise between Rs 135 crore and Rs 150 crore through a 100% fresh issue of approximately 62.6 lakh equity shares. Proceeds were earmarked for content development (Rs 30 crore), international content acquisitions (Rs 20 crore), technology upgrades (Rs 15 crore), and working capital needs (Rs 50 crore). A portion was also set aside for general corporate use.
More about Ullu Digital
The platform, which focuses on short films, regional programming, and web series, is promoted by Vibhu Agarwal and Megha Agarwal, who together hold a 95% stake in the company. Ullu operates in the same space as listed firms such as Zee Entertainment and Shemaroo Entertainment, but is differentiated and often criticised for its adult-oriented programming.
The IPO was being managed by Narnolia Financial Services as the lead merchant banker. If successful, Ullu’s public listing would have surpassed previous SME IPOs, including Spectrum Talent Management’s Rs 105 crore issue and Aashka Hospitals’ Rs 101.6 crore offering. But with the ban now enforced, analysts say Ullu’s market debut may be delayed, if not derailed entirely, as investor sentiment takes a hit.